Fed's favorite inflation gauge shows prices fell in July

Consumer prices fell 0.1% in July, as plunging gasoline prices dragged down a price index that's closely watched by the Federal Reserve.

Why it matters: It's an encouraging sign for the Fed as it wages an intense battle against inflation. Still, even as price gains cool they remain uncomfortably high. Inflation is still up 6.3% compared to this time last year by this measure, the highest in decades.