For the first time in seven months, U.S. consumer prices fell in August, a development experts attributed to the continued decline in gasoline prices along with a strong dollar, CNBC noted.

In its Consumer Price Index, the U.S. Department of Labor on Wednesday detailed a 0.1 percent drop after economists polled by Reuters had forecast prices to remain unchanged. Last month, gas prices fell 4.1 percent, marking the biggest drop since January; energy costs declined 2 percent, and food prices were up a mere 0.2 percent.

Meanwhile, a separate Labor Department report showed that Americans' inflation-adjusted weekly earnings grew 0.7 percent in August, Dow Jones Business News noted. That increase was due to a rise in hourly earnings, which -- adjusted for inflation -- rose half a percent. American workers were also putting in more hours as the average workweek grew 0.3 percent, the newswire added.

The Labor numbers mean that prices are up just 0.2 percent over the past year, though there are exceptions when it comes to certain products: Eggs, for instance, are 35.3 percent more expensive that they were a year ago, a development that reflects the impact of the avian flu that struck some parts of the country early in the year, CNBC explained.

"The drop in gasoline costs boosted American households who have more money these days to spend on restaurant meals and clothing. That ultimately helps the consumer-driven U.S. economy," Dow Jones Business News commented. But the deflationary outlook is a challenge for the Federal Reserve, which was hoping to raise the benchmark interest rate after robust job growth has pushed down unemployment to 5.1 percent.

The central bank, which is set to hold a critical policy meeting Wednesday, may well hold off on an interest rate hike for the time being, TD Economics economist Andrew LaBelle said in a note to clients, the Wall Street publication revealed.

"With nary a whiff of inflation in sight, we expect the Fed to take a pass on hiking tomorrow," LaBelle predicted. But "in time, a tightening labor market leading to stronger wages will feed through to price growth," he added.