US Inflation Rate Remains Above Fed Target Amid Trade Tensions

The inflation rate in the US remains stubbornly high, despite efforts to curb it. According to the Commerce Department's report on Wednesday, prices rose by 3.7% in July compared to a year earlier, matching June's rate.

This is above the Federal Reserve's target of 2%, and has been exacerbated by ongoing trade tensions with countries like Canada and China, as well as the recent Iran war which pushed gas prices up.

Excluding volatile food and energy categories, core inflation remained unchanged at 3.3% in July. This is a concern for the Fed, who may need to take action to slow borrowing and spending to combat higher prices.

The Commerce Department plans to adjust its measurements of financial services and software costs next month, which could lower measured inflation by 0.2 percentage points or so.