July inflation data strengthens case for September rate cut

The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.2% on a seasonally adjusted basis in July, after rising 0.3% in June. The U.S. Bureau of Labor Statistics reported the new numbers Tuesday.

 "July prices increased in line with expectations, with items most likely to be impacted by tariffs either rising at a slower rate or remaining flat compared to June’s print,” said America’s Credit Unions Senior Economist Dawit Kebede. “Core prices increased primarily due to services such as transportation and medical care. Given the weakening labor market and restrictive monetary policy, the Federal Reserve will most likely cut rates in September. Markets are already pricing in a higher probability of this move."