Consumer prices remain unchanged in July from June
WASHINGTON (AP) – U.S. consumer prices were unchanged in July from June, as a small drop in energy costs offset slightly higher food prices, the government said Wednesday, August 15th.
The consumer price index hasn’t changed since March, evidence that the weak economy is keeping inflation in check.
The Labor Department said core consumer prices, which exclude volatile food and energy costs, ticked up 0.1% last month. More expensive medical costs, clothing and rents pushed up core prices.
Prices increased 1.4% in the 12 months ending in July. That’s down from 1.7% in June and is the smallest yearly increase in 20 months. Core prices have increased 2.1% in the past year, down from a 2.2% pace in June.
Mild inflation gives the Federal Reserve more leeway to take steps to boost growth.
U.S. stock futures remained lower after the report as expectations fade that central banks will step in with a quick fix to nudge along the fragile economic recovery.
Economic indicators are likely easing the sense of urgency for fiscal policy makers to act quickly. Retail sales numbers released Tuesday were much better than expected, and economists expect industrial production likely increased in July as automakers boosted activity. The industrial report will be released at 9:15 a.m. ET Wednesday by the Federal Reserve.
China also appears less likely to act on a stimulus, like it did in 2008, for fear of inflation.