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Inflation eases in July as gasoline and grocery prices fall

Consumer prices in July were up 3.4% from a year ago — a smaller annual increase than in May or June. The news makes it less likely the Fed will feel the need to raise interest rates in September.

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Why it matters

A slower inflation rate reduces pressure on the Federal Reserve to raise interest rates, which would increase borrowing costs for mortgages, auto loans, and credit cards.

Most affected

Borrowers seeking mortgages, auto loans, and credit cards — Lower likelihood of higher interest rates in the near term.
Savers and retirees with fixed-income investments — Slower rate-increase path may reduce returns on savings accounts and bonds.

Watch next

Whether the Federal Reserve holds interest rates steady at its September meeting, or moves contrary to the inflation trend.

Read it at NPR