US inflation edges lower in July as food prices cool
Annual US inflation slowed slightly to 3.4% in July from 3.5% in June, as food price growth eased even though housing costs kept pushing prices up.
The US Bureau of Labor Statistics reported that consumer prices rose 3.4% over the year to July, a slight easing from June's 3.5% annual rate. On a monthly basis, prices climbed 0.1%, driven mainly by higher housing costs. Because housing makes up such a large share of household spending, even modest rent increases can noticeably move the overall inflation figure.
Food prices rose only slightly in July, growing more slowly than in June, while energy prices fell during the month, giving consumers some relief. Still, the broader energy market remains volatile: with the Middle East conflict ongoing, gasoline prices are up 24.6% over the past year, underlining continued strain in global energy markets.
Core prices, which exclude food and energy, rose 0.2% in July after being flat in June. Medical care and airline ticket prices edged higher, while car insurance costs kept falling.
Fed and political reaction
New Federal Reserve chair Kevin Warsh said the central bank's priority remains bringing inflation down further while trying to avoid unnecessary economic shocks. President Donald Trump said inflation is still too high for many families, pointing to rent and grocery bills as evidence that living costs remain a major burden.
Financial markets took the report in stride, with stocks little changed since the figures were broadly in line with expectations. Meanwhile, growing concerns about the labour market — after July's report showed job losses — have dampened expectations of an interest rate hike.
