Inflation remains at the level – for now – but the next wave of prices focused on prices is already in motion: “They go up, we have seen that”

Consumer prices increased by 2.7% in July compared to the previous year, the Department of Labor said on Tuesday, the same as the previous month and more than one post-pandemic hollow of 2.3% in April. Excluding the volatile food and energy categories, basic prices increased by 3.1%, compared to 2.9% in June.

The figures suggest that the slowdown in the growth of the cost of less expensive rents and gas compensates for part of the impact of the radical tariffs of President Donald Trump. Tuesday’s figures probably reflect the 10% universal rate that Trump that Trump imposed in April, as well as higher tasks on countries like China and Canada.

However, stubborn inflation placed the federal reserve in a difficult situation: hiring has slowed heavily in the spring, after Trump announced prices in April. The stalling of employment gains has increased financial market expectations for a drop in interest rates by the central bank.

However, the president of the FED, Jerome Powell, warned that the worsening of inflation could maintain the Fed on the sidelines – a position which strengthened Trump, which challenged the traditional standards of the independence of the central bank and required lower borrowing costs.

Tuesday data arrives at a very busy time for the work statistics office of the Labor Department, which collects and publishes inflation data. Trump dismissed Erika Mcentarfer, then the BLS chief, after the report of the jobs of August 1 also showed a strongly lower hiring for May and June than what had been reported above.

The president posted on Monday on the social networks that he had chosen EJ Antoni, economist at the Conservative Heritage Foundation and frequently criticizes the report of jobs, to replace Mcentarfer.

“EJ will ensure that the figures released are honest and accurate,” said Trump on Truth Social.

Adding to the turmoil of the BLS is a job freeze on a government scale which forced it to reduce the amount of data it collects for each inflation report, the agency said. The UBS economist, Alan Detmeister, estimates that BLS now receives around 18% less price quote for the inflation report than a few months ago. He thinks that the report will produce more volatile results, although average over time, always reliable.

On a monthly basis, prices should increase modestly, increasing only 0.2% from June to July and basic prices up 0.3%. Gas prices probably dropped in July and the costs of the grocery store should barely increase, disintegrating overall inflation.

Signs of tasks climbing prices emerged for the first time in the June inflation report published last month. Toys prices jumped from 1.8% from May to June, after an increase of 1.3% the previous month. Clothing prices increased by 0.4% in June, while sports products jumped by 1.8%.

Meanwhile, the average price level has increased from around 2% before the inauguration of Trump to almost 18%, the highest since the early 1930s, according to the LAB budget in Yale. Most imports from the European Union and Japan are now faced with 15%rights, while Taiwan goods pay 20%and Switzerland, 39%.

Other trends help prevent inflation from increasing more quickly. Price increases for apartment rents, for example, are regularly cooled after clear tips during the pandemic era. And the prices of new cars have decreased slightly in recent months, even after Trump stuck 25% of duties on car cars and car parts.

So far, car manufacturers and abroad pay prices, although economists say they will probably transmit them to consumers soon. Automobile companies also pay 50% tax on steel and aluminum and 30% on parts from China.

Ford said he had paid $ 800 million in prices in the second quarter, while General Motors provided $ 1.1 billion. Stellantis, the world’s fourth automaker in the world and the brands manufacturer such as Chrysler, Dodge and Jeep, said that he had paid $ 350 million in prices at an expected cost of $ 1.7 billion this year.

Consumers are likely to absorb more costs beyond the automotive industry in the coming months because Trump has started to finalize many prices. Once companies know what they pay, they are more likely to adopt these costs to consumers, say economists.

Trump insisted that overseas manufacturers will pay the prices by reducing their prices to compensate for the tasks. However, the prices of pre-tariff imports have not decreased much since the implementation of samples.

Goldman Sachs economists estimate that foreign manufacturers have absorbed only 14% of rights until June, while 22% were paid by consumers and 64% by American companies. Based on the previous models, however – such as Trump’s tasks in 2018 on washing machines – economists expect that consumers to date support 67% of the burden, while foreign exporters pay 25% and American companies only manage 8%.

Many large companies are still increasing prices in response to prices, including manufacturers of Ralph Lauren and Under Armor, and the Warby Parker glasses.

The consumer product giant Procter & Gamble, manufacturer of Crest toothpaste, detergent at tide and Charmin toilet paper, said at the end of last month that it would increase prices on approximately a quarter of its percentage products in half-edge.

And the manufacturer of cosmetics Elf Beauty, which manufactures the majority of its products in China, said on Wednesday that it had increased prices by a dollar on its assortment of products due to August 1 due to tariff costs, the third price increase in its 21 years of history.

“We tend to direct, then we will see how much more to follow ourselves,” said CEO Tarang Amin during a call for results on Wednesday.

Matt Pavich, principal director of strategy and innovation at Revionics, a company that provides AI tools to large retailers to help them assess price decisions, says many companies selectively increase prices to compensate for prices, rather than in all areas.

“So far, we have not seen a huge blow for consumers in retail prices,” said Pavich. “Now they go up, we have seen it.”

Correction, August 14, 2025: A previous version of this article destroyed the title of Matt Pavich’s job.