Cooler July Inflation Opens Door to Fed Pause on Rates
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Good morning. This is Jeff Sparshott from the Wall Street Journal with the latest on the economy.
Price pressures continued cooling last month, likely deterring the Federal Reserve from raising interest rates at its September meeting. The consumer-price index, a measure of goods and services prices across the economy, rose a mild 0.2% in July, the same as in June, the Labor Department said Thursday. Core prices, which exclude volatile food and energy categories, also increased just 0.2 % in both months, extending a broader slowdown in price pressures. The figures led to 3.2 % annual inflation in July, up from 3 % in June. Annual core inflation ticked down to 4.7 % in July from June’s 4.8 %, Amara Omeokwe, Nick Timiraos and Christian Robles report.
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The core CPI, in particular, adds to recent data that calls into question whether the central bank will need to raise rates again this year, as most officials had projected in June. Fed officials focus on core inflation because they see it as a better predictor of future inflation than the overall inflation rate.
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