Inflation eased slightly last month but held near its highest level in four decades even as gas prices fell and supply chains improved.
The Bureau of Labor Statistics’ latest Consumer Price Index (CPI) reflected a year-over-year increase of 8.5% in July, down from the prior month’s 40-year high of 9.1%. Consensus economists were expecting last month’s reading to show an 8.7% increase, according to estimates compiled by Bloomberg.
Core CPI, which excludes the volatile food and energy components of the report, remained firm, rising at an annual 5.9%, unchanged from June’s figure.
The gasoline index fell 7.7% in July, marking the largest month-over-month drop in this component of the report since April 2020.
A downward trend in gasoline prices over more than 50 consecutive days provided some relief to U.S. consumers last month after record energy costs pushed inflation to the highest reading of the cycle in June, but inflationary pressures remained strong across other components of the report.
“The drop in gasoline prices has been very welcome, but that doesn’t solve the inflation problem,” Bankrate Chief Financial Analyst Greg McBride said in emailed comments, pointing to a core reading that remained up nearly 6% over the past year. “Consumers are getting a break at the gas pump, but not at the grocery store.”
July’s data showed a continued rose on the food index, up 1.1% over the month as the food-at-home index rose 1.3%.
(This post is breaking. Please check back for updates.)
—
Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc
Read the latest financial and business news from Yahoo Finance
Download the Yahoo Finance app for Apple or Android
Follow Yahoo Finance on Twitter, Facebook, Instagram, Flipboard, LinkedIn, and YouTube
Source: finance.yahoo.com