US Consumer Prices Eased Slightly in July

Consumer prices in the U.S. increased slightly in July, with inflation easing compared to previous months.

The Labor Department reported that consumer prices were 3.4% higher than a year ago, a smaller annual increase than in May or June. Rent and airfare prices rose, while gasoline and grocery prices fell. Lettuce prices plunged 16% in July, the largest one-month decline on record, following a recall due to a Cyclospora illness outbreak that led retailers to offer deep discounts.

These lower grocery prices contributed to a 0.1% decline in grocery costs last month, though overall grocery prices are still up about 2.7% over the past year. The cooler inflation report may lead the Federal Reserve to monitor inflation moderation rather than raise interest rates in September. Japan's wholesale prices were up 7.2% in July, and average retail prices for pork and chicken hit record highs in August due to the yen's weakening.