Inflation ticked down slightly year-over-year in July as rising prices and elevated interest rates continue to drag on Americans’ finances, according to the latest Bureau of Labor Statistics (BLS) release on Wednesday.
The consumer price index (CPI), a broad measure of the price of everyday goods, increased 2.9% on an annual basis in July and increased 0.2% month-over-month, compared to 3.0% in June, according to the BLS. Core CPI, which excludes the volatile categories of energy and food, rose 3.2% year-over-year in July, compared to 3.3% in June.
Inflation rose from just 1.4% when President Joe Biden took office in January 2021 to a peak of 9% in June 2022, with July being the first month CPI has fallen below 3% since. Economists expected inflation to increase by 0.2% for the month and remain constant at 3.0% for the year, according to investment research and financial services firm Morningstar.
Tomorrow Wednesday 8:30 AM
CPI & core CPI estimated
YoY 3.0% & 3.2% pic.twitter.com/VFUQuO2unN— NOVA REAL INVEST (@novarealinvest) August 13, 2024
Recession fears have surged following a disappointing BLS jobs report that saw unemployment rise to 4.3% in July, up from 4.1% in June. The rising specter of a U.S. economic slowdown sparked a global market sell-off last week, with Japan’s Nikkei 225 index falling 12.40% on Aug. 5 in its largest one-day fall since Black Monday in 1987.
Nevertheless, markets recouped much of their losses the following day, with the Nikkei rising 10.2%.
On July 31 the Federal Open Market Committee (FOMC) decided to keep its federal funds rate target range between 5.25% and 5.5%, marking the eighth straight meeting where the FOMC has decided not to adjust the rate.
Elevated interest rates have increased the cost of borrowing for consumers and businesses substantially. Delinquent credit card balances reached their highest level in the first quarter of 2024 since the Federal Reserve Bank of Philadelphia began tracking the metric in 2012, with total revolving balances rising to $628.6 billion.
Given rising unemployment and a significant reduction in inflation since the June 2022 peak, the Federal Reserve is expected to cut rates at its September meeting, with 100% of interest rate traders predicting a reduction in the federal funds rate, according to the CME Group’s Fed Watch Tool. However, traders remain divided as to how aggressive the Fed will be, with roughly 55% of the experts predicting a 0.5% cut and 45% expecting a 0.25% cut.
All content created by the Daily Caller News Foundation, an independent and nonpartisan newswire service, is available without charge to any legitimate news publisher that can provide a large audience. All republished articles must include our logo, our reporter’s byline and their DCNF affiliation. For any questions about our guidelines or partnering with us, please contact licensing@dailycallernewsfoundation.org.
