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U.S. inflation drops to 8.5%

U.S. inflation has fallen significantly.

By Mike Hesp
• 1 min read
U.S. inflation drops to 8.5%

U.S. inflation has fallen significantly. The energy sector in particular showed a notable drop.

After a record 9.1% last month, inflation in the U.S. is falling. As the Bureau of Labor Statistics (BLS) said in a press release, the inflation rate in July dropped to 8.5%, missing analysts' expectations. Analysts had previously forecast a drop to 8.7%.

The reason is likely the lower price of crude oil. Overall, the energy index fell by 4.6% from June, according to the BLS.

On the other hand, food prices rose by another 1.1%. Because of high inflation, the U.S. Federal Reserve had already raised its main interest rate several times. The latest hike was 0.75 percentage points.

Although economists are now seeing a trend reversal, some experts still believe further rate hikes are necessary.

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