Inflation likely stayed low last month as Federal Reserve edges closer to cutting rates

WASHINGTON (AP) — If the Federal Reserve needs any further evidence that the worst price spike in four decades is steadily easing, it’s likely to come Wednesday, when the government is expected to report that inflation cooled further last month.

Consumer prices are thought to have risen just 0.2% from June to July, according to economists surveyed by FactSet, a pace only slightly above the Fed’s 2% annual inflation target. Measured from a year earlier, inflation is forecast to have remained 3%, the same as in June.

Excluding volatile food and energy costs, so-called core prices are also expected to have risen 0.2% from June and 3.2% from 12 months earlier, just below the 3.3% annual increase in June.

For months, cooling inflation has provided gradual relief to America’s consumers, who were stung by the price spikes that erupted three years ago, particularly for food, gas, rent and other necessities. Inflation peaked two years ago at 9.1%, the highest level in four decades.

Inflation has taken a central role in the presidential election, with former President Donald Trump blaming the Biden administration’s energy policies for the price spikes. Vice President Kamala Harris on Saturday said she would soon unveil new proposals to “bring down costs and also strengthen the economy overall.”

<bsp-list-loadmore data-module="" class=«PageListStandardB» data-gtm-region=«RELATED COVERAGE» data-gtm-topic=«No Value» data-show-loadmore=«true» data-gtm-modulestyle=«List B»> <bsp-custom-headline custom-headline=«div»> RELATED COVERAGE </bsp-custom-headline> <bsp-custom-headline custom-headline=«div»> US wholesale inflation cooled in July in sign that price pressures are continuing to ease </bsp-custom-headline> <bsp-custom-headline