US Inflation Slows Down, But Prices Remain Elevated

The US inflation rate slowed down in July, according to the Labor Department. Consumer prices rose by 3.4% from a year ago, down slightly from 3.5% in June.

The modest decline could ease pressure on the Federal Reserve to raise interest rates to combat rising costs. However, prices are still higher than before the Iran war began in February, when inflation was 2.4%. On a monthly basis, prices rose just 0.1% from June to July.

Excluding volatile food and energy categories, core inflation also slipped to 2.5% in July from a year ago, down from 2.6% in June. The figure matches the post-pandemic low reached in January and February before the Iran war.