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US consumer prices likely increased moderately in July as gasoline prices eased
Yahoo Finance • • general
Key Points:
- U.S. consumer prices likely increased moderately in July, with the Consumer Price Index (CPI) expected to rise 0.1% after a 0.4% decline in June, reflecting a slight rebound amid falling gasoline prices.
- Core CPI inflation, excluding volatile energy and food prices, is forecasted to increase 0.2% monthly and 2.5% year-on-year, indicating inflation remains above the Federal Reserve's 2% target.
- Despite cooler inflation readings potentially reducing expectations for further Fed rate hikes, wage growth lagging behind prices continues to strain consumers and may impact political dynamics ahead of the November midterm elections.
- Inflation pressures persist due to increases in used car prices, education, communication goods, and airfares, while economists remain divided on trends in hotel and motel room prices.
- The core Personal Consumption Expenditures (PCE) price index, closely watched by the Fed, is expected to rise 0.2% in July, supporting the possibility of a Federal Reserve interest rate hike in September.
