U.
S. inflation eased slightly in July as underlying price pressures eased, giving the Federal Reserve more room to keep rates steady, even as the unresolved Gulf war in the Middle East drove up energy prices. According to the Ministry of Labor, the consumer price index (CPI) rose 3.4% year-on-year in July, compared with 3.5% in June. Core inflation, which excludes volatility in food and energy prices, rose 2.5% from 2.6% in June. Both indicators were in line with the estimates of analysts surveyed by Trading Economics, and followed last week's employment report, which showed weak labor market conditions in the United States.
Pantheon Macroeconomics noted in a note to clients that favorable consumer price index data gives the Fed solid reasons, along with weak employment data, to keep policy unchanged next year. Month.
The July report confirms the view that inflation is no longer accelerating. Combined with a weaker-than-expected employment report released last week, these data lowered expectations that the Fed would raise rates at its September meeting. The CME FedWatch probability assessment tool, published after the publication of the consumer price index, suggested a 38% chance of an increase in September, compared with 54.5% a week ago.
On a monthly basis, the consumer price index rose 0.1% in July after falling 0.4% in June, while the benchmark index rose 0.2% in the month after no change in June, indicating renewed pressure following the resumption of hostilities in the Persian Gulf in July following a short-term ceasefire.
The energy index rose by 14.7% in the 12 months ended in July, down from a 15.7% increase in June. Energy prices rose by 24.7% in July, compared with a 27.1% increase in June. Gasoline prices rose by 24.6% year-on-year, down from an increase of 26.7% in the previous month. Fuel oil rose in price by 39.1% after an increase of 42.9%. Gas supply services increased by 4.3% over the year, following a 3% increase in June.
The food index increased by 3% year-on-year in July, unchanged from the previous month.
"The decline in gasoline prices is likely to stop in August," Oxford Economics said in a note. Housing price Index
It grew by 3.2%, down from 3.3% in June. Services
Excluding energy services, which are considered the main indicator of prices for services, they increased by 3%, down from 3.2% in June. Prices for new cars
Increased by 0.5% year-on-year in July, unchanged from June, while prices for used cars
