(Bloomberg) -- Prices paid by U.S. consumers climbed in July at a more moderate pace, marking a deceleration that stops short of full relief from cost increases weighing on sentiment and driving policy debate.
The consumer price index increased 0.5% from June and 5.4% from a year ago, according to Labor Department data released Wednesday. Excluding the volatile food and energy components, the so-called core CPI rose 0.3% from the prior month and 4.3% from July 2020.
Faced with supply constraints and surging demand, businesses are raising prices for goods and services as cost pressures mount. Ongoing challenges including materials shortages, shipping bottlenecks and hiring difficulties will likely continue to put broader upward pressure on prices in the months ahead.
At the same time, the outsized gains may ease as some price surges linked to the economy’s reopening ebb.
The median forecast in a Bloomberg survey of economists called for a 0.5% gain in the overall CPI from the prior month and a 5.3% year-over-year increase.
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