Financial News: U.S. Consumer Prices Rise 0.2% In July, Slightly

U.S. Consumer Prices Rise 0.2% In July, Slightly More Than Expected

08/26/2026 - 10:20:00 (RTTNews)

(RTTNews) - Consumer prices in the U.S. increased by slightly more than expected in the month of July, according to a closely watched report released by the Commerce Department on Wednesday.

The Commerce Department said its personal consumption expenditures (PCE) price index rose by 0.2 in July after edging down by 0.1 percent in June. Economists had expected prices to inch up by 0.1 percent.

The report also said the annual rate of growth by the PCE price index came in at 3.7 percent in July, unchanged from June. The annual rate of growth was expected to slow to 3.6 percent.

The slightly bigger than expected monthly increase in consumer prices came as prices for services climbed by 0.3 percent, more than offsetting a 0.1 percent dip in prices for goods.

Excluding food and energy prices, the core PCE price index still rose by 0.2 percent in July after inching up by 0.1 percent in June. The increase matched economist estimates.

The annual rate of growth by the core PCE price index was 3.3 percent in July, unchanged from June and in line with expectations.

"Although many of the PCE numbers were worse than expected, the most important one - YoY Core PCE - held constant and that will give the Fed more time to leave rates on hold," said Chris Zaccarelli, Chief Investment Officer for Northlight Asset Management. He added, "The number of dissenters at the next meeting may grow because the month-over-month readings (headline and core) are getting worse, but we believe enough of the FOMC will want to wait to see more data before making a decision to raise rates next month."

The Federal Reserve's preferred readings on consumer price inflation were included in the Commerce Department's report on personal income and spending.

The report said personal income climbed by 0.4 percent in July after rising by 0.2 percent in June. Economists had expected personal income to increase by another 0.2 percent.

Meanwhile, the Commerce Department personal spending rose by 0.2 percent in July after climbing by 0.3 percent in June. Personal spending was expected to inch up by 0.1 percent.

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