The Clap
Inflation grew at a lower-than-expected rate last month, due largely to a drop in gasoline prices.
The Deets
Prices increased at an annual rate of 8.5% during July 2022, better than analysts’ expectations of 8.7%.
Core inflation, which excludes volatile food and energy prices, also witnessed a smaller than expected increase of 5.9%.
Why this Matters
Stock futures rose after the news that inflation came in better than expected.
The % return at the end of Wednesday’s session for Dow Jones, S&P 500, and NASDAQ went up by 1.6%, 2.13%, and 2.88% respectively.
This also takes significant pressure off of the Fed, which has been hiking up interest rates in order to combat inflation. Although inflation has cooled down in July, the Fed will need more reassurance that inflation has cooled over the coming months.
US inflation grows 8.5% in July, better than expected💥
