The Consumer Price Index (CPI) rose 0.2% in July. Compared to last year, prices were up 2.7%, unchanged from June’s report. The 1.1% decline in energy prices and 2.2% decline in gasoline prices helped the headline reading remain stable.
Core inflation – which leaves out food and energy – rose 0.3% in July, in line with estimates. On a yearly basis, core prices are up3.1%, an increase from 2.9% in June, and 0.1% hotter than estimates.
While tariffs didn’t significantly impact this report, the shelter component accounted for more than half of core inflation. Some other areas that caused inflation to rise were airline fares, used cars and trucks, and medical care services.
What’s the bottom line?
While tariffs were expected to push prices higher, their impact was smaller than feared and did notcause a larger increase in the overall consumer inflation reading. Most costs remain tame aside from the aforementioned items.
