1 month ago
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Key Takeaways
- Headline inflation eased to 3.4% while core CPI eased to 2.5%.
- The print weakens the case for another Fed rate increase.
- Shelter remains sticky even as monthly energy prices fall.
- Thursday’s PPI report could reinforce or challenge the improving inflation picture.
US Inflation Eases to 3.4%
The U.S. Consumer Price Index rose 0.1% in July on a seasonally adjusted basis after falling 0.4% in June. Over the past 12 months, headline inflation slowed to 3.4% from 3.5%.
Core CPI, which strips out food and energy, increased 0.2% during the month and eased to 2.5% year over year, down from 2.6% in June.
Shelter rose only 0.1% in July but still accounted for roughly two-thirds of the monthly increase in the overall index. Food prices were also up 0.1%, while energy declined 1.5%.
The monthly energy drop helped the headline reading, although energy prices remained 14.7% h...
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