Inflation Rate Edges Up, Driven by Rent and Grocery Costs
The annual inflation rate witnessed a minor increase last month due to a surge in rent, gas, and grocery prices. July’s consumer prices marked a 3.2% growth compared to the previous year. This subtle rise in the inflation rate breaks its consistent decline over the past year.
Notably, the current acceleration, although modest, aligns with market predictions.
Delving into specifics, there was a 0.2% price escalation from June to July. A significant portion of this monthly hike can be attributed to the surge in rents. In addition, while gasoline and grocery costs increased during July, gasoline prices remain lower than the previous year’s rates.
When setting aside the unpredictable food and energy prices to assess the “core inflation”, the rate stood at 4.7% for the year ending in July. This marks a slight decrease from the 4.8% observed in June.
In other market movements, while the prices for both new and used vehicles declined in July, the costs associated with shelter went up by 0.4%.
Despite the general trend of inflation easing, it surpasses the Federal Reserve’s 2% target. As the Federal Reserve gears up for its next interest rate decision in September, it will consider one more monthly inflation assessment.
