A fall in energy prices last month eased inflation, according to a report closely watched by the Federal Reserve.
Consumer prices rose 6.3 per cent in July, the biggest rise since 1982, after recording a 6.8 per cent annual increase in June, the Department of Commerce reported on Friday. Energy prices he made the difference in July. After surging in June, it fell last month.
So-called core inflation, which excludes volatile food and energy prices, rose 4.6% last month from a year earlier, according to Commerce.
In the spring of 2021, inflation began to rise sharply as the economy rebounded from the short but devastating coronavirus recession a year ago at an alarming rate. A surge in customer orders overwhelmed factories, ports and freight yards, leading to delays, shortages and higher prices.
The Federal Reserve was slow to respond to rising inflation, believing it to be a temporary consequence of supply chain bottlenecks. We have raised interest rates four times since March.