Key Consumer Price Index gauge rises as Trump trade war weighs
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A key measure of consumer prices that strips out energy and food costs rose at a faster clip in July, the Bureau of Labor Statistics said on Tuesday.
Why it matters: It is a sign that inflation is starting to heat up as the effects from President Trump's tariffs ripple across the economy.
By the numbers: The Consumer Price Index rose 0.2%, ticking down from the 0.3% increase in June, as energy and gasoline prices plummeted.
- But core CPI — the measure watched most closely by policymakers, which excludes food and energy prices — rose 0.3%, up from the previous month's 0.2% increase.
- In the 12 months through July, core CPI rose 3.1%, up from the prior month's 2.9% increase.
- Overall CPI rose by 2.7%, holding steady from June.
The big picture: The data comes at a critical time for the U.S. economy.
- Many economists anticipate the Federal Reserve will cut interest rates in September.
- Trump has been pressuring the Fed to slash rates, but the central bank has fretted about the potential inflationary effects from White House tariff policy.
The intrigue: There are fresh concerns about government data integrity after Trump fired the head of the Bureau of Labor Statistics, following a less-than-stellar jobs report.
- Monday night, Trump said he would nominate E.J. Antoni to lead the BLS. The Heritage Foundation economist has been a vocal critic of the agency in years past.
Editor's note: This story has been updated with additional data on the report.
