Fed Rate Cut Hopes Fade as Inflation Hits 3.4%, Powell Signals Pause
U.S. inflation increased modestly in July, with prices rising 0.1% from June and 3.4% over the year, the Bureau of Labor Statistics reported Wednesday. The annual rate eased from 3.5% in June, while core inflation, excluding food and energy, rose 0.2% monthly and 2.5% annually. Shelter costs increased 0.1% and accounted for roughly two-thirds of July’s increase, while energy prices fell 1.5%. Food prices rose 0.1% and remained 3% higher than a year earlier. The report matched economist expectations and offered limited evidence of accelerating inflation. Markets reduced expectations for a September Federal Reserve rate increase, although inflation remains above the Fed’s 2% target. Chairman Kevin Warsh has emphasized price stability, while policymakers face competing concerns from inflation and weaker employment. JPMorgan expects a December hike, but September remains uncertain. CPI report and employment data will arrive before the September meeting.
Prepared by Christopher Adams and reviewed by editorial team.
- Articles Published:
- 26
- Right Leaning:
- 1
- Left Leaning:
- 1
- Neutral:
- 24
- Distribution:
- Left 4%, Center 92%, Right 4%
Left: Coverage emphasizes household costs, wages, and lower-income households’ pressure. Center: Coverage emphasizes cooling inflation alongside persistent risks above target. Right: Coverage emphasizes inflation persistence, rate discipline, and consumer pressures.
August 12, 2026, 8:30 a.m. ET: BLS released July CPI. https://www.bls.gov/news.release/cpi.nr0.htm
Coverage of Story:
From Center
Fed Rate Cut Hopes Fade as Inflation Hits 3.4%, Powell Signals Pause
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