WASHINGTON — Consumer prices climbed 2.9
The Labor Department said Friday that the consumer price index ticked up 0.2
"For Americans to benefit more from the expansion, real wage growth needs to be positive as it usually is in this phase of an expansion," said Robert Frick, a corporate economist with Navy Federal Credit Union.
Most of July's increase in consumer prices came from higher housing costs. Prices for energy, medical care and apparel slipped in July, while food expenses rose slightly.
Adjusted for inflation, average weekly earnings have fallen 0.1
During the past year, higher prices for oil, gasoline and transportation have caused the inflation rate to jump after it had hovered at relatively low levels for the previous six years. The sudden increase in prices has not only wiped out average growth, but it also creates pressure for the Federal Reserve to hike short-term interest rates so that inflation stays close to the U.S. central bank's 2
The Fed has already raised rates twice this year and another two rate hikes are expected before the start of 2019. By making it more expensive to borrow, the Fed would likely tamp down on inflation as well as economic growth, making it more difficult for President Donald Trump to achieve the sustained 3
Rising gasoline costs have complicated the inflation picture. Gas costs have surged 25.4
Josh Boak, The Associated Press