Inflation held steady in July as consumer prices rose 2.7% year-over-year, matching June’s pace, according to The Wall Street Journal. The increase came in below the 2.8% forecast by economists, according to the Labor Department. Core inflation, which excludes food and energy, rose 3.1%, slightly above expectations. Prices for shelter, energy, and groceries fell or stabilized in July, helping keep overall inflation in check. Energy prices fell, grocery prices stayed flat, and rent growth was modest in July. The data keeps a potential Federal Reserve rate cut on the table for next month amid signs of a cooling labor market. Economists remain divided over whether Trump’s tariff hikes will have lasting inflationary effects, with some pointing to slow pass-through while others cite rising imported goods prices. Stocks rallied, with the Dow up about 1% and the S&P 500 and Nasdaq hitting record highs.
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