Economic Update

1. INFLATION

  • The Consumer Price Index (CPI) rose by 8.5% year-over-year through July, but remained flat from the
    month before, according to the Bureau of Labor Statistics. It was the first time that inflation hadn’t
    increased on a month-over-month basis since May 2020.
  • A 7.7% decline in gasoline prices in July helped alleviate pressure on the broader index, while an increase
    in food and shelter offset some of that movement. Food costs rose by 1.1%, the seventh consecutive
    monthly increase of 90 bps or more.
  • Other declines were seen in airline fares, used cars and trucks, communication, and apparel.
  • Core CPI, which removes food and energy prices from the calculation, rose 30 basis points, the smallest increase in four months. Core CPI is up 5.9% year-over-year.

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