What To Expect From August’s CPI Inflation Report

On August 10 at 8.30am ET Consumer Price Index data for the month of July will be released, revealing the latest U.S. inflation trends. The prior reading for June was encouraging as headline inflation rose at a 3% annual rate and the monthly increase in core CPI was 0.2%, the smallest increase since August 2021.

After a lot of the large price spikes from 2022 have rolled off of the CPI series, so reducing inflation, especially core inflation, further in the second half of 2023 may be slower going. Broadly, this is the Federal Reserve’s perspective and accounts for why they expect to maintain interest rates at relatively high levels into 2024 if that assessment holds.