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The CPI rose a modest 0.2 percent (1.9 percent annual rate) in July. Unlike in June, energy prices were much more subdued in July. While gasoline prices rose, this increase was partially offset by declines in the indexes for natural gas and electricity. Overall, the energy index rose 2.8 percent in July and 4.8 percent over the past twelve months. The latter is the largest year-over-year increase in the energy index since February 2012, but the average annual increase in the index over the last decade was 6.3 percent.
Federal Reserve Bank of Cleveland-based measures of underlying inflation increased at about the same pace in July?0.2 percent (2.0 percent annual rate) for the median CPI and 0.1 percent (1.7 percent annual rate) for the trimmed-mean CPI. On a year-over-year basis, these three measures of underlying inflation continue to show considerable stability. The twelve-month change in the median CPI has been 2.1 percent since March, while the core CPI and the trimmed-mean CPI have fluctuated in a band of 0.2 percentage points since then. Over the past twelve months through July, the core CPI rose 1.7 percent and the trimmed-mean CPI rose 1.8 percent. The year-over-year change in the all-items index has drifted up from 1.1 percent in April to 2.0 percent in July.
With respect to the distribution of price changes, about 40 percent of price changes (on a weighted basis) fell between 1 and 3 percent, with about the same proportion of prices rising at rates below 1 percent.