The economy still has a long way to go on inflation
According to the Bureau of Labor Statistics, price levels were unchanged in July after rising 1.3 percent in June. And over the year, prices were up 8.5 percent, down from June’s 9.1 percent growth rate.
The Consumer Price Index for All Urban Consumers (CPI-U) was unchanged in July on a seasonally adjusted basis after rising 1.3 percent in June, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 8.5 percent before seasonal adjustment.
Consequently, real wages were up in July — from June — due to the fact that the Price Index did not change. However, compared to last year, wages are still down 3.6 percent.
Real average hourly earnings for all employees increased 0.5 percent from June to July, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. This result stems from an increase of 0.5 percent in average hourly earnings combined with no change in the Consumer Price Index for All Urban Consumers (CPI-U).
Real average hourly earnings decreased 3.0 percent, seasonally adjusted, from July 2021 to July 2022. The change in real average hourly earnings combined with a decrease of 0.6 percent in the average workweek resulted in a 3.6-percent decrease in real average weekly earnings over this period.
What this means
8.5 percent inflation is still extremely high. So while over the month numbers are a bit promising, compared to last year, prices are nowhere near where we want them to be.
With the inflation rate still at a 40-year high, the economy still has a long way to go, especially considering that many essentials — like groceries — have still gone up.
Whether inflation has truly peaked remains yet to be seen.