US Inflation Stays High Amid Trade Conflicts and Iran War

Despite ongoing US trade conflicts and the Iran war, inflation in the US remains stubbornly high. According to a recent report from the Commerce Department, prices rose 3.7% in July compared to the same month last year, matching June's rate. This is significantly above the Federal Reserve's 2% target.

The report also showed that core inflation, which excludes food and energy prices, was unchanged at 3.3% in July. It had fallen to 2.6% before President Donald Trump imposed tariffs on various goods in April 2025.

Americans may be becoming more cautious as inflation stays high, with consumer spending adjusted for inflation remaining unchanged in July. The report also showed that gas prices fell sharply last month, declining 2.7% from June to July, but car prices jumped 0.4% and housing costs rose 0.3%.

New Fed Chair Kevin Warsh will deliver a high-profile speech on Friday at the Jackson Hole conference in Wyoming, which will be closely watched by Wall Street for any signs of his thinking about next steps to combat inflation.