The retail price index increased 1.0% in July, in line with expectations and unchanged from June.
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Economists estimate that the gauge of inflation rose 0.2% month-on-month in July, and by the same amount excluding volatile food and energy costs, according to Bloomberg.
Analysts had expected consumer prices and the core index to rise 0.2%.
The Federal Reserve’s target for price stability is 2.0 per cent inflation over the longer term.
The food and non-alcoholic beverages index increased by 0.1% between June 2015 and July 2015.
Nationally, the U.S. headline Consumer Price Index increased at its slowest pace in three months.
Higher prices for shelter, including rents and hotel rates, are helping prop up inflation, offsetting declines in a broad stretch of categories, including air fares, new and used cars and household furnishings.
Clothing prices have been named as the main influence of Britain’s rising inflation rate last month. It was the second month the annual CPI increased after plunging crude oil prices pushed it into negative terrain in January. “Indeed, with inflation muted and another wave of austerity set to hit the economy, we still think the MPC will hold off from raising interest rates until Q2 2016 and will increase Bank Rate to just one per cent by the end of next year“.
“The U.S. inflation outlook… provides no justification for policy tightening at this juncture”, said Kocherlakota, who believes inflation concerns should be secondary to promoting job growth.
Many market participants are still expecting Janet Yellen and the Federal Reserve to raise interest rates in September.
The rate was a small increase on May’s figure of 5.6 per cent, and now takes the average price for a home to a record high of £277,000.
However, while inflation has seen a small rise in July, experts still foresee near-zero price increases for another few months.
The more hawkish picture of underlying inflation came a day after Bank of England rate-setter Kristin Forbes said a “preventative” rate rise could be needed to avoid “sunburn” for the economy.
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“Whilst it is true that the wage rises and low inflation has put more money in consumers’ pockets, we are still only able to spend, and consume, so much, particularly in the clothing sector”.
