Politics
JUST IN: Americans Get Welcome Financial News As Trump Economy Defies Experts
Americans got another dose of encouraging economic news Wednesday as inflation cooled in July, driven by falling prices for gasoline, groceries and prescription drugs.
The consumer price index rose just 0.1% from June, according to new data from the Department of Labor. On an annual basis, prices were up 3.4%, down from 3.5% the previous month.
The July reading matched economists’ consensus forecast, but the broader trend showed inflation continuing to ease as several everyday expenses moved lower.
Core inflation, which strips out volatile food and energy prices, increased 0.2% for the month. On a yearly basis, core prices rose 2.5%, down from 2.6% in June.
The relatively tame numbers could take some pressure off the Federal Reserve as officials weigh their next move on interest rates.
Futures markets showed the odds of another rate hike at the Fed’s September meeting slipping from nearly 50% to roughly 40% following the report.
Goods prices fell 0.2% in July, marking the second straight monthly decline.
When food and beverages were excluded, goods prices dropped 0.4%. Durable goods prices rose 0.3% after falling in May and remaining unchanged in June.
Services prices increased 0.2% after being flat the previous month.
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At the grocery store, consumers caught another break. Grocery prices declined 0.1% in July, while prices for restaurant meals and other food consumed away from home increased 0.3%.
Shelter costs rose just 0.1% and accounted for roughly two-thirds of the overall monthly increase in consumer prices.
Rents climbed 0.1%, while the government’s measure of the implied cost of living in an owner-occupied home rose 0.3%. Homeowners’ and renters’ insurance prices dipped 0.1%.
Under President Trump and Republicans inflation remained low and steady during July.
FOX BIZ: “We’ve tied the lowest year over year print since January.” pic.twitter.com/dv0SpJqfwa
— RNC Research (@RNCResearch) August 12, 2026
Without shelter costs included, overall consumer prices were flat for the month.
Energy prices provided some of the biggest relief.
The energy index dropped 1.5% in July, while gasoline prices fell 2.9% after plunging 9.7% in June.
Prescription drug prices also moved sharply lower, falling 0.8% for the month. That marked the third consecutive monthly decline.
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Prescription drug prices have now fallen in five of the last six months and have not posted an increase during any month this year. Nonprescription medicine prices also dropped 0.3%.
Consumers shopping for household goods saw additional price declines.
Major appliance prices fell 1.9% in July and are now down 4.1% compared with a year ago. Furniture prices were unchanged for the month.
New car prices remained flat after declining 0.2% in June, while new truck prices edged up 0.1%.
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Used car and truck prices rose 0.4% for the month, but remained 1.9% lower than a year earlier.
Motor vehicle insurance prices also declined 0.3% after dropping 2% in June.
The latest inflation report gives the Trump administration another favorable economic data point as the White House argues its policies are helping ease pressure on American households.
With gasoline, groceries, prescription drugs, appliances and auto insurance all moving lower in July, consumers finally saw relief across several categories that have hammered family budgets in recent years.
