US inflation steady at 2.7% in July, core prices edge higher amid tariff pressures

Consumer inflation in the United States held steady in July, but firmer core price gains signaled persistent underlying pressures as trade tariffs continue to filter through the economy.

Figures from the Department of Labor on Tuesday showed the consumer price index (CPI) rising 2.7% year-on-year, matching June’s pace and coming in just below the 2.8% rate economists had expected.

The stability in the headline number masked shifting trends beneath the surface. Energy and gasoline prices eased during the month, helping to offset higher shelter costs. But core CPI, which excludes food and energy, rose 0.3% from June, a faster pace than the 0.2% recorded the previous month. On an annual basis, core inflation reached 3.1%, up from a year earlier.

The report highlighted notable increases in medical care, airline fares, and household furnishings.

Economists say the data adds to the challenge facing the Federal Reserve as it weighs the combined effects of softer job growth, reflected in July’s employment figures, and the inflationary push from President Donald Trump’s new round of tariffs.

With price pressures holding firm and trade-related costs building, markets are bracing for signals on whether policymakers will adjust interest rate expectations in the months ahead.