SFS Insights: CPI Report: Falling Probabilities of a September Rate Hike
- According to the July CPI report, consumer prices rose by 3.2% year over year, a minor increase from the 3.0% annual rate recorded in June.
- Not surprising, the largest contributor to the monthly increase in prices was shelter costs.
- Monthly core inflation, which excludes food and energy, rose 0.2% for the second consecutive time, as core inflation has downshifted in recent months.
- Inflation is still considerably above the 2% level where the Federal Reserve (Fed) would like to see it but the trajectory is encouraging.
- So far, the data suggests the Fed will likely pause at the next meeting but no guarantees for the November meeting.
