US inflation remains sticky as consumer demand beats expectations

Durable goods orders for July came in at $339.3 billion, rising 1.1% month-over-month and handily beating analyst expectations. The numbers tell a complicated story July’s Consumer Price Index came in at 0.2% month-over-month and 2.5% year-over-year. Those figures landed roughly in line with expectations. Core CPI showed the same 0.2% monthly increase. The Personal Consumption Expenditures price index, which the Fed actually prefers over CPI as its inflation gauge, was projected to show a year-over-year core reading of approximately 3.3%. Meanwhile, retail and food services sales dipped 0.6% month-over-month to $763.6 billion in July. That figure still represents a 5.0% increase compared to the same month a year earlier. Durable goods tell a different story entirely New orders for manufactured goods with a lifespan of three years or more climbed 1.1% to $339.3 billion. Transportation equipment orders drove much of the increase, surging 2.3% in July. What the Fed does next The probability of a Fed rate hike in September dropped to around 35% as of mid-August, down from higher levels earlier in the summer. Disclosure: This article was edited by Editorial Team. For more information on...