Last month, the increases in rents and prices for services such as veterinary treatment cooled, noted Greg McBride, analyst for Bankrate.com
“Shelter and services costs have been the long-standing and persistent trouble spots in the inflation readings but maybe the tide is starting to turn,” he said.
At hearings in Washington this week, Republican lawmakers warned Fed chairman Jerome Powell that a rate cut ahead of the November election would be perceived as trying to “gin up the economy” for the president.
Mr Powell refused to speculate about when the Fed would make its next move, but defended the bank’s political independence and said its decision would be rooted in the data.
He told lawmakers a cut was the most likely next step, noting that the bank was alert, not just to inflation figures, but also to signs that the economy was slowing.
“We’re very much aware that we have two-sided risks now and we’re determined to balance those as best we can,” he said. “We want to see more good inflation data and we also want to continue to see a strong labour market.”
In June, the US unemployment rate crept above 4% for the first time in more than two years.
Consumer spending, which is the main driver of the US economy, has also shown signs of weakening, as rising numbers of firms warn that households are cutting back.
Food giant Pepsi-Co became the latest to do so on Thursday.
In a quarterly update for investors, it reported that sales in its North America Frito-Lay and Quaker Foods units had fallen in the April-June period compared with last year. Overall, revenue was up about 1% globally.
Credit: Source link
