Has Inflation Peaked? Maybe, but It Could Be ‘Painfully Slow’ to Fall
The cooler-than-expected July inflation data fueled hopes that consumer prices peaked earlier this summer after a year of relentless increases that crushed Americans, created a political firestorm for President Biden and forced the Federal Reserve to hike interest rates at the fastest pace in decades.
The consumer price index climbed 8.5% in July from the previous year, a bigger drop from the 9.1% recorded in June than economists projected. On a monthly basis, the index did not move at all as decreases in the cost of oil, gasoline and airfares offset increases in food and rent.
When excluding more volatile measurements of food and gasoline, prices jumped 5.9% in July, matching the previous month.
While the slowdown is likely a welcome respite for the Fed as it tries to wrestle inflation under control, experts cautioned that inflation remains painfully high and could be slow to return to pre-pandemic levels around 2%. (Read more from “Has Inflation Peaked? Maybe, but It Could Be ‘Painfully Slow’ to Fall” HERE)
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