While economists expected another modest rise in inflation on a MoM basis (if far below the 1.3% surge in June), the headline US Consumer Price Inflation was expected to slow from +9.1% YoY to +8.7% YoY in July, but it actually slowed significantly more than expected to +8.5% Yoy (flat MoM), ending a 16-month streak of MoM gains.
.but Shelter costs continued to rise (+0.5% MoM)…
The shelter index continued to rise but did post a smaller increase than the prior month, increasing 0.5 percent in July compared to 0.6 percent in June.
The rent index rose 0.7 percent in July and the owners’ equivalent rent index rose 0.6 percent.
The index for lodging away from home continued to decline, falling 2.7 percent in July after a 2.8-percent decrease in June.
The shelter index rose 5.7 percent over the last year, accounting for about 40 percent of the total increase in all items less food and energy.
This was partially offset by a modest drop in used car prices.
Finally, and perhaps most importantly, real average weekly earnings continues to plunge, now down 16 straight months as inflation eats away at any wage gains…
” … and do not harm the oil and the wine.”
Read More @ Zero Hedge HERE