Consumer prices rose 0.1% in July, as expected, putting the annual rate at 3.4%
Energy costs drove the monthly gain, while core inflation slowed to 2.5%, suggesting price pressures are easing but remain above the Federal Reserve’s target.
- On Aug 12, the Labor Department said consumer prices rose 0.1% over the month, with the annual inflation rate reaching 3.4%.
- Inflation has been pushed higher by economic shocks, including President Donald Trump's tariffs imposed last spring and higher gas prices stemming from the Iran war.
- Excluding volatile food and energy, Core inflation rose 0.2% over the month and 2.5% over the year, while Average hourly earnings for employees on private nonfarm payrolls rose 3.2%.
- While slowing annual inflation is welcome news to Federal Reserve officials, it remains well above the Fed's 2% target, where it has stayed for five years.
- But inflation is still higher than before the Iran war began in February, when it was 2.4%, suggesting limited impact from oil and gas price shocks on broader costs.
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US CPI Moderates to 3.4 Per Cent YoY in July as Lower Energy Prices Offset Shelter, Food Pressures
Get latest articles and stories on Business at LatestLY. US consumer inflation moderated to 3.4 per cent year-on-year in July 2026 from 3.5 per cent in June, primarily as a decline in energy prices helped offset continued price increases in shelter and food, according to data released by the US Bureau of Labor Statistics on Wednesday. Business News | US CPI Moderates to 3.4 Per Cent YoY in July as Lower Energy Prices Offset Shelter, Food Pressur…
The slowdown in consumer price increases in the United States was confirmed in July, taking advantage of the pause in the Middle East conflict and its positive impact on energy prices, a new welcome for the US central bank.
The CPI rose 0.1% in July and annual inflation dropped to 3.4%, in line with what was expected by the market, according to the U.S. Bureau of Labor Statistics.
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