Now Reading: US inflation cools as weak jobs complicate September Fed decision
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US inflation cools as weak jobs complicate September Fed decision
US inflation cools as weak jobs complicate September Fed decision
US wholesale inflation eased in July, with annual producer-price growth slowing to 4.7% from 5.5% in June, The Economic Times reports. Wholesale prices were flat during the month, while core inflation fell…
The Story in Brief
US wholesale inflation eased in July, with annual producer-price growth slowing to 4.7% from 5.5% in June, The Economic Times reports. Wholesale prices were flat during the month, while core inflation fell to 4.2% from 4.7%. Gas prices reversed part of their Iran war-related rise, though a later increase could lift August figures. Consumer prices also cooled modestly, but have outpaced wages for four months, putting pressure on rent, utilities and other essentials.
At the same time, the US economy lost 23,000 jobs in July, and average monthly hiring over the past three months fell to about 20,000. Boston Fed president Susan Collins told the Financial Times that lower and moderate-income families were struggling with everyday costs. She backed holding rates in July but left open a September increase if inflation stays too high. Three Fed presidents supported a July hike.
The Indian Opinion
The lazy claim that cooling wholesale prices have solved America’s cost problem ignores households whose bills still rise faster than pay. The opposite claim, that weak hiring automatically demands a rate cut, is just as narrow. The Fed must weigh energy prices, wages and employment together. The next PCE inflation reading, alongside August jobs data, should show whether July’s relief is durable or temporary.
Sources (2): english.mathrubhumi.com, economictimes.indiatimes.com
This story was synthesised by AI from the 2 sources linked above.
Updated: this story now draws on 2 sources.
