Inflation fell to 3.4% in July, easing a bit of pressure on Fed

Published August 12, 2026 8:35am ET | Updated August 12, 2026 9:01am ET



Inflation fell one-tenth of a percentage point in July to 3.4%, a decline that comes as the Federal Reserve considers whether to raise interest rates in the coming months.

The Bureau of Labor Statistics reported the update to the consumer price index on Wednesday. In July alone, prices only rose 0.1%. Still, inflation is well above the Federal Reserve’s target of 2%, and many investors and Fed watchers expect an interest rate increase this year.

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