According to fresh data, US prices grew 3.4% in the year to July, slightly less than the 3.5% increase seen in the year to June. As the turmoil in the Middle East raged on, energy prices remained erratic. While gasoline prices fell 2.9% in July compared to June, they were still up 24.6% for the year.
The Bureau of Labour Statistics reported that inflation increased by 0.1% month on month, owing primarily to a rise in housing prices. Even little changes in rent can increase the overall headline amount because it accounts for a big portion of household spending.
Food costs climbed just marginally in July, slower than in June, while energy prices declined, providing some comfort to consumers. While inflation was somewhat lower in July than in June, these numbers indicate that prices are rising more slowly rather than dropping.
Prices excluding food and energy increased 0.2% after remaining unchanged in June, with medical care and airline tickets rising and vehicle insurance continuing to fall. Kevin Warsh, the incoming Federal Reserve chair, has stated that the central bank’s top aim is to “keep inflation moving down” while avoiding unnecessary economic disruptions.
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