The U.S. inflation rate came down in July after several months of growth. At 8.5 percent annualized inflation, the number remains high, however. U.S. inflation had grown from 2.7 percent in March 2021 to 9.0 percent in June 2022—rising almost continuously with just two breaks, according to a recent feature from Statista.com. Whether the current easing is also a short respite or the turning of a corner remains to be seen.

While the Consumer Price Index for All Urban Consumers (CPI-U) stood at 8.5 percent compared to a year ago, the core index, excluding more volatile food and energy prices, increased 5.9 percent over the last 12 months. The July reading was the highest since December 1981.

When inflation started spiking in the spring/early summer of 2021, it was largely due to the so-called base effect, reversing the pandemic’s cooling effect on consumer prices a year earlier. At the onset of the pandemic, prices had taken a dive due to a sudden drop in consumer spending and fuel demand before slowly climbing back to their pre-pandemic trajectory over the summer and fall. 

Due to that initial dip in consumer prices, year-over-year comparisons were always going to be exaggerated for a while, but that is no longer the case. Click here to read the full story from Statista.com.