US July CPI rose 0.1%, easing annual inflation rate to 3.4%
Why it matters: The report pushed Treasury yields lower and cut market odds of a September Fed rate hike to 42%.
US consumer prices rose 0.1% in July, matching forecasts and nudging the annual inflation rate down to 3.4%, a sign that price pressures eased after earlier energy-driven spikes. Core CPI, which strips out food and energy, increased 0.2% on the month and 2.5% from a year earlier, Bureau of Labor Statistics data showed Wednesday. Energy prices fell 1.5% in July after a 5.7% drop in June, while food and shelter each rose 0.1%. Shelter still accounted for about two-thirds of the headline monthly increase, the BLS said. Markets welcomed the data: stock futures rose, Treasury yields fell and traders reduced the chance of a September Federal Reserve rate increase to 42%, according to CME Group's FedWatch gauge.