The U.S. Consumer Price Index (CPI) rose 0.2% in July compared to the previous month, with the 12-month cumulative annual growth rate of 3.2%, up 0.2% point from 3.0% in June, the U.S. Department of Labor said on the 10th.
The U.S. CPI annual inflation soared to a 41-year high of 9.1 percent in June last year and then fell to 3.0 percent in June this year. It marked the first rise in 13 months after a 12-month decrease.
However, the reversal of the rise was fully expected to come from a 12-month cumulative tally, rather than as a sign that U.S. prices began to jump again.
The 12-month cumulative inflation is the sum of the monthly growth rate, and the monthly growth rate in July last year was 0.0 percent, which is missing from the annual inflation tally in July this year. However, the monthly increase CPI rate in July this year, which is newly included, was 0.2%, which means that the total increased by 0.2 percentage points.
Earlier, annual inflation in June plunged 1.0 percentage points from 4.0 percent in May, with the monthly increase rate of 1.2% in June last year and the monthly increase rate of 0.2% in June this year.
As a result, the U.S. Fed is likely not to raise its key interest rate at its sixth meeting this year on September 21. The Fed first suspended its key interest rate in June after raising it by a total of 5.0 percentage points 10 times in a row from March last year to May this year. Then, at the 5th meeting at the end of July, the government implemented a 0.25 percentage point increase again, making the target range of the benchmark interest rate 5.25-5.50%.
If raised again in September, it could be a serious acknowledgement of July inflation’s 0.2 percentage point reversal rise. The U.S. CPI’s monthly gain is not serious, with 0.1% in March, 0.4% in April, 0.1% in May, 0.2% in June and 0.2% this July.
Meanwhile, the U.S. CPI rose 0.2 percent month-on-month in core statistics excluding volatile energy and food sectors, while the annual cumulative figure fell 0.1 percentage point to 4.7 percent. The missing energy sector fell 12.5 percent annually as of July, while food rose 4.9 percent.
The U.S. economy grew 2.4% annually in the second quarter of this year (April to June), exceeding 2.1% of last year’s total. In terms of employment conditions, the net increase in business jobs in June and July was lowered to 180,000, half of last year’s monthly average, and the unemployment rate was 3.5%, the lowest in 53 years.
