US inflation rises 0.1% in July

The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.1% in July on a seasonally adjusted basis, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index rose 0.2%.

I am at work today (yes, I have a job!) and can’t post a full analysis. But I have updated my Tracking Inflation and I Bonds page to reflect these new numbers.

Holders of TIPS and I Bonds are also interested in non-seasonally adjusted inflation, which is used to adjust the principal balance of TIPS and set future interest rates for I Bonds. In July, the inflation index rose 0.01% – essentially unchanged – to 238.654, and is up 0.2% over the last 12 months.

The next I Bond interest rate adjustment will come November 1, based on non-seasonally adjusted CPI-U from March to September. With two months remaining in that period, inflation is up 1.07%, indicating a new annualized rate of 2.14%, but two months remain. With gas prices declining, that number could move lower.

Here is the 12-month inflation trend:

12 month inflation

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