US consumer prices likely rose slightly in July, keeping inflation in focus before Tuesday, 12 August 2025 CPI release. As a result, forecasts point to a 0.2% monthly rise and a 2.8% annual gain. Core inflation is expected to climb 0.3% for the month and 3.0% over the year. While some service costs have cooled, tariff-sensitive goods continue to put pressure on US consumer prices.
Tariffs Add Strain to US Consumer Prices
In recent months, new import duties have pushed up costs for goods like furniture, apparel and toys. Consequently, these increases have supported higher core readings for US consumer prices. Analysts link the trend to tariff effects seen earlier this year. Additionally, research shows the average US tariff burden has grown significantly. As pre-tariff inventory runs out, US consumer prices could face more upward pressure.
Data Quality Gaps Could Distort Inflation Picture
Due to budget cuts and staffing shortages, the Bureau of Labor Statistics has halted in-person CPI data collection in several cities. This includes one city each in Nebraska, Utah and New York. Moreover, around 15% of the national sample is paused. To fill gaps, the bureau has expanded “different cell imputation” to 35% of June CPI data, compared with just 8% a year earlier. Experts believe the method does not bias results, but it can make US consumer prices appear more volatile. In addition, price quotes are down about 18% from earlier this year, adding uncertainty.
Fed Decision Hinges on US Consumer Prices
Looking ahead, markets are watching whether July’s reading will support expectations for a September rate cut. If results match forecasts, policy-easing hopes could remain intact. However, sticky core inflation and ongoing tariff pressures may complicate the decision. Leadership changes at the statistics bureau add to the scrutiny, making US consumer prices a crucial factor for the Fed’s next move.
ore inflation and ongoing tariff effects could complicate the decision. Leadership changes at the Bureau of Labor Statistics add to the heightened scrutiny as investors and policymakers analyse the inflation data.
US consumer prices may only be edging up, but the combination of tariff pressures and data-collection gaps means every decimal point will carry extra weight this week.
