ARLINGTON, Va.—On a seasonally-adjusted basis, overall consumer prices rose 0.6% during July. The Bureau of Labor Statistics reported that the overall consumer price index (CPI) grew 1% over the 12-month period.
"Strong demand and persistent supply chain issues for items like food and consumer durables have led some to speculate that the exit from the pandemic could see inflationary pressures accumulate," said NAFCU Chief Economist and Vice President of Research Curt Long. "But consumer sentiment fell in July, partly due to curtailing fiscal spending, and dampened demand should prevent that outcome.
“Inflationary concerns are extremely low and should not cause the Fed any second thoughts about keeping short-term rates anchored at zero,” he added.
Energy prices rose 2.5% during the month, following a 5.1% rise in June. Long noted that despite the increases, they are well-below year ago levels (-11.1%). Food growth was up 0.4% in July and rose 4.1% on a year-over-year basis.
Core prices (excluding food and energy costs) rose 0.6% in July. Year-over-year core CPI growth was 1.6%.