The United States’ inflation rate dropped to 8.5% for the month of July, a little figure lower than the 9.1% it hit in the month of June.
In contrast to a monthly gain of 1.3% recorded a month ago, the CPI statistics released on Wednesday showed no increase between June and July.
However, Inflation pressures persisted despite the numbers coming in lower than anticipated. With the increase in the food index, the annual growth rate reached 10.9%, which is the fastest rate since May 1979.
Falling Gasoline Prices Softens US Inflation Rate To 8.5% In July 2022
Even with the monthly drop in the energy index, electricity prices rose 1.6% and were up 15.2% from a year ago. The energy index rose 32.9% from a year ago.
Used vehicle prices posted a 0.4% monthly decline, while apparel prices also fell, easing 0.1%, and transportation services were off 0.5% as airline fares fell 1.8% for the month and 7.8% from a year ago.
The numbers indicate that inflation pressures are easing somewhat but still remain near their highest levels since the early 1980s.
The July drop in gas prices has provided some hope after prices at the pump rose past $5 a gallon. But gasoline was still up 44% from a year ago and fuel oil has increased 75.6% on an annual basis, despite an 11% decline in July.
The Federal Reserve is employing a strategy of interest rate rises and related monetary policy tightening in an effort to curb inflation rates that are significantly higher than their long-term aim of 2%.
As of now in 2022, the central bank has increased benchmark borrowing rates by 2.25 percentage points, and authorities have made clear signs that additional rises are imminent.
The inflation data were released following a strong jobs report on Friday last week that stamped out fears of a near-term recession but suggested the Fed was struggling to cool down the overheated economy.