Public Peek: Truflation US Inflation Update for July 2024
The following is a public peek at our exclusive monthly CPI update, available in full by subscription, here.
Recent inflation trends
Inflation is hanging around for much longer than expected and was holding steady since the beginning of the year, though over the last few months, it has begun cooling, down from 3.4% in April to 3.0% in June. Overall, though, it appears elevated inflation has yet to disappear.
Against the background, the Fed has signaled that rate cuts are back on the agenda but needs to see continued progress on the data ahead of the September meeting. With inflation remaining above the 2% target and modest progress on taming it, policymakers remain cautious and need to see the labor market softening. Our forecast continues to hold steady that the first rate cut will commence in September.
Read the Entire June 2024 Inflation Update
The labor market has shown signs of deceleration, with unemployment rising to 4.3%, its highest level in nearly three years. This increase, though still within a historically low range, reflects the broader economic cooling. Job gains have been the second lowest since 2020, and wage growth has started to slow, indicating that the labor market may be reaching a turning point.
Exhibit 1 - Previous Month Change in Non-Farm Payroll & Unemployment Rate
Source: Bureau of Labor & Statistics