July Inflation Data

There’s good reason to think inflation will continue to slow. What I think gets lost in that discussion is, slow by how much?

Michael Pugliese, an economist at Wells Fargo. The inflation rate slightly decreased during the month of July, largely due to dropping energy prices.

Why It Matters: High inflation means your money buys you less. New July data “indicate[s] that inflation pressures are easing somewhat but still remain near their highest levels since the early 1980s” (CNBC). Bottom line: We saw a bit of a dip, but inflation remains historically high.

• What increased: Some increases include food, vehicles, and medical care. The continued increase in grocery prices means they are now about 13% higher than they were a year ago, which is “the largest year-over-year increase since 1979,” according to the Associated Press.
• What decreased: Price hikes for gasoline, hotels, and air travel slowed down, most likely due in part to people opting for less expensive trips this summer.

Lower prices offer Americans slight reprieve from inflation (Associated Press)

Consumer prices rose 8.5% in July, less than expected as inflation pressures ease a bit (CNBC)

How Inflation Hit Households in July: Higher Prices for Food, Electricity and Alcohol Consumed at Home (WSJ)