According to analysts, Inflation in July will be the highest since the start of the coronavirus pandemic, indicating that the dramatic rise in consumer prices has reached its pinnacle. According to Dow Jones, economists estimate a 0.5 percent increase in the consumer price index in July or a gain of 5.3 percent year over year. Compared to a 0.9 percent gain in June, or 5.4 percent year over year, the most significant monthly increase since August 2008.
Economists predict a 0.4 percent increase in CPI last month, excluding energy and food, compared to a 0.9 percent gain in core in June. June’s core CPI of 4.5 percent was the highest since September 1991 on a year-over-year basis. Price hikes in plane tickets and lodging are projected to continue — if at a reduced pace — in locations where there was pent-up demand when the economy reopened.
The central bank has stated that Inflation is just temporary. The market focuses on employment data to determine whether the labor market is as strong as it appeared in the July jobs report released on Friday. Although the Fed’s favored Inflation gauge is the Inflation component of personal consumption expenditures data, the hot CPI readings are likely to be coming to an end.