As Midterms Approach, Inflation Numbers Are Undercutting The Democrats’ Affordability Message

Core prices, a measure that excludes volatile food and energy prices, rose 0.2 percent compared with the previous month. For the year, core prices are up 2.5 percent, a decline in year-over-year inflation from the previous month’s 2.6 percent.

The moderate monthly readings across all times and core inflation, along with the decline in the year-over-year inflation rate, will likely ease concerns among Fed officials. Prices of fed funds futures implied the odds of a rate hike at the Fed’s next meeting in September fell from nearly 50 percent to around 40 percent.

Goods prices fell 0.2 percent, the second consecutive monthly decline. Excluding food and beverages, goods prices dropped 0.4 percent. Durable goods prices rose 0.3 percent after declining in May and remaining flat in June.

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JUST NOW: US inflation cools slightly to 3.4% and 0.1% month over month

The likelihood of the Federal Reserve raising interest rates is PLUMMETING

Good! Keep it going and SLASH rates pic.twitter.com/chstGF6w9w

— Eric Daugherty (@EricLDaugh) August 12, 2026

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This is a very positive sign the easing of inflation is in line with expectations and is good news for both the economy and the markets.

— Moonlight Endures

(@MoonlightEsyiz) August 12, 2026

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Inflation Fell Further In July as Prescription Drugs, Gasoline, and Grocery Prices Decline https://t.co/eDDqfjD3e6

— Rapid Response 47 (@RapidResponse47) August 12, 2026

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The United States’ position as ⁠a net oil exporter and the drawing down ‌of petroleum inventories had cushioned the ⁠hit on the economy from the oil price shock sparked by the Middle East conflict, but some economists said that could not persist indefinitely.

They also ⁠added that the U.S. and other nations would at some point need to replenish petroleum inventories, which would keep oil prices elevated.

President Donald Trump accused ‌Iran of being “devious negotiators” in an interview released late on Monday and described some of his current options in the war — “just bop along” and let Tehran fail economically or hit them “really, really hard.”

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John Lonski: "It is good news! And I could not help but note that the annual rate of core CPI inflation… 2.5% in July. That’s back to where it was prior to the start of the Iran conflict." https://t.co/eFbzhTvMlO pic.twitter.com/rb1daqOqMe

— Rapid Response 47 (@RapidResponse47) August 12, 2026

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