Money | inflation Inflation Is Tamer Than Expected, With an Asterisk 'Core' prices jump 3.1%, which is above expectations By John Johnson Posted Aug 12, 2025 8:10 AM CDT Copied A shopper picks lemons at a Presidente Supermarket, Wednesday, Aug. 6, 2025, in North Miami, Fla. (AP Photo/Marta Lavandier) Tuesday's highly awaited inflation report amid a slew of new tariffs offers a mixed narrative about the economy: Main number: Overall inflation came in tamer than expected in July: Prices rose 2.7% compared to last July, a tick below the Wall Street consensus of 2.8%, reports CNBC. The annual figure of 2.7% is the same as June's, per the AP. 'Core' concern: However, the closely watched measure of core prices—which strips out volatile food and gas prices—rose 3.1%, which is a tick above forecasts of 3% and the fastest annual pace in five months, reports the New York Times. Economists see core prices as a better gauge of underlying trends, notes the Wall Street Journal. Monthly: On a monthly basis, July prices rose 0.2% from June and core prices rose 0.3%, both in line with expectations. Markets: Investors on Wall Street seemed pleased with the new numbers overall, with Dow futures jumping more than 200 points. The odds of a rate cut from the Federal Reserve next month is now 91%, up from 85% before the report's release, per CNBC. Read These Next US deports more than 100 Iranians. Tossed beers, hostile fans take the spotlight at Ryder Cup. North Carolina shooting suspect once walked the red carpet. Skydivers leap from plane 2 minutes before fatal crash. Get breaking news in your inbox. What you need to know, as soon as we know it. Sign up Report an error