WASHINGTON – Inflation in the U.S. remained subdued in July, extending a slowdown this year.
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The consumer-price index, which measures what Americans pay for everything from ice cream to doctor visits, increased 0.1% in July from the prior month, the Labor Department said Friday. Excluding the often-volatile categories of food and energy, so-called core prices also rose 0.1%.
Economists surveyed by The Wall Street Journal had expected overall and core prices to both advance 0.2% on the month.
From a year earlier, overall consumer prices climbed 1.7%, as did core prices.
Certain indexes showed signs of weakness. The shelter index--a measure of rent, mortgage payments and lodging--rose 0.1% in July, its smallest increase since March. That in part reflected a sharp decline in the cost of lodging away from home, which measures hotel prices and school boarding costs.
Other segments showed gains. The index for apparel rose 0.3% in July after declining in each of the past four months, despite expected discounts associated with brick-and-mortar store closures.
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The report is the Federal Reserve's latest peek at a major inflation gauge. The central bank is tasked with achieving maximum sustainable employment and stable prices. With unemployment at 4.3% in July, it appears the Fed has closed in on one half of its mandate. Inflation, however, has continued to disappoint.
"Every inflation print going forward, especially leading up to the next couple of Fed meetings [is] critical," said Laura Rosner, economist at MacroPolicy Perspectives. "We've had a lot of weakness in CPI and PCE data earlier in the year, and the question is, 'Was that noise or is it something more fundamental and therefore persistent?'"
The Fed's preferred measure of inflation, the price index for personal-consumption expenditures, was unchanged in June from the prior month, the second straight flat reading. It was up 1.4% in June from a year earlier and has dropped for four consecutive months on an annual basis, from 2.2% in February.
The consumer-price index tends to run a little bit higher than the personal-consumption index, reflecting different methods for calculating inflation. Both gauges have followed the same pattern.
A separate Labor Department report showed average weekly earnings for private-sector workers, adjusted for inflation, increased 0.2% in July from the prior month. From a year earlier, inflation-adjusted weekly earnings were up 1.1%.
The Labor Department's latest report on the consumer-price index can be accessed at: https://www.bls.gov/news.release/cpi.nr0.htm
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(END) Dow Jones Newswires
August 11, 2017 08:45 ET (12:45 GMT)