But inflation thrived in housing, electronics (hit by the AI boom), medical services, auto repair, used vehicles, etc.

By Wolf Richter for WOLF STREET.

The all-items CPI (which includes food and energy) barely inched up (+0.07%) in July from June, after the negative reading in the prior month. The “core” CPI (excludes food and energy) rose by only 0.22%, after a negative reading in the prior month. The core services CPI rose by only 0.23%, according to data from the Bureau of Labor Statistics today.

All of them were held down on a month-to-month basis by a motley collection of standout factors:

The CPI for hotels and motels plunged by a massive 3.3% in July from June, after having already plunged by 2.8% in June from May. This pulled down the core services CPI, the core CPI, and the all-items CPI. And it caused the CPI for “shelter” to be nearly flat (+0.1%). Shelter accounts for 35% of total CPI. But the CPI for Rent (+0.3%) and the CPI for Owner’s Equivalent of Rent (+0.3%), the big components in Shelter, accelerated in July from the June pace.

The CPI for Motor Vehicle Insurance dropped by 0.3% in July from June, after plunging in the prior two months. But it’s still up by about 50% since January 2022! This pulled down the core services CPI, the core CPI, and the all-items CPI.

The CPI for gasoline plunged by 2.9% in July from June, after having already plunged in June, from the spike in the prior months. Gasoline accounts for about half of the overall energy CPI. But the CPI for electricity ticked up, and the CPI for utility natural gas jumped. And so the energy CPI plunged by 1.5% in July from June, which pulled down the all-items CPI.

The CPI for “food at home” dipped by 0.1% in July from June, pushed down by a drop in prices of beef (-0.8%), pork (-1.5%), and chicken (-0.7%), finally. I saw my first hopeful “sale” sign on ground beef along with a lower price the other day, but we’ll continue boycotting beef at these ridiculous prices, even if they’re a little lower, and enjoy other delicious animal proteins instead. So maybe we’re not alone and demand has finally tapered off enough to bring down prices.

Pork chops (-2.8%), yummy, especially bone-in. Fresh whole chicken (-0.8%), amid articles recently about a “chicken glut.” Let there be gluts! Egg prices (-0.5%) continued to fall from their spike through March 2025. The CPI for roasted coffee (-0.4%) dipped for the second month in a row. Coffee futures, which impact consumer coffee prices down the road, have dropped by 23% since their peak in November. So there’s hope.

But prices of fish and lots of other food categories rose, and so it was a mixed bag, so to speak.

This tiny increase of the CPI for food at home (+0.1%) held down the all-items CPI.

But inflation was alive and well elsewhere.

AI boom hit consumer electronics: Prices of items with lots of semiconductors in them jumped in July from June: Computers & peripherals (+3.5%), smartphones (+1.1%), TVs (+1.7%), other video equipment (+2.1%).

The CPI for “food away from home” rose by 0.3% in July from June, at the high end of the recent range. This CPI covers prices at restaurants, delis, cafeterias, etc.

CPIs related to motor vehicles: The used vehicle CPI rose at the fastest pace in four months (+0.4%). The CPI for motor vehicle parts and equipment jumped (+0.6%). But the CPI for new vehicle edged up only 0.1%.

The CPI for medical care services jumped by 0.6%, the biggest increase in months.

The CPI for auto maintenance and repairs jumped by 0.6% in July from June, on top of the big jumps in the prior two months. The index has soared by 53% since January 2020.

And year-over-year…

The all-items CPI (includes food and energy) inched up 0.07% in July from June after the drop in the prior month, hammered down by the effects described above (blue line in the chart).

Year-over-year, it rose by 3.4%, a slight deceleration from the prior month.

Since January 2020, the all-items CPI has soared by 30%.

The core CPI (excludes food and energy) rose by 0.22% in July from June (blue line in the chart below).

Year-over-year, it rose by 2.5%, a slight deceleration from the prior month (red line).

Since January 2020, the core CPI has soared by 27%.

The core services CPI, which excludes energy services such as electricity, rose by 0.23%, held down by the plunge of the CPI for hotels and motels and the drop in motor vehicle insurance.

Year-over-year, it rose by 3.1%, a deceleration from the prior month (red line).

Since January 2020, the core services CPI has soared by 30%.

Its two biggest components: The CPI for Rent rose by 0.3% month-to-month, and by 2.9% year-over-year, both an acceleration from the prior month; the CPI for Owners Equivalent of Rent (OER) rose by 0.3% month-to-month and by 3.2% year-over-year, roughly the same pace as in June.

The “core goods” CPI (all goods except food & energy goods) rose by 0.2% in July from June.

Year-over-year, it rose by 0.8%, roughly at the same pace as in June.

Since January 2020, the core goods CPI has risen by 16%.

This chart shows the price level of the core goods CPI, not the percentage change:

The CPI for food at home ticked down by 0.07% in July from June. This index tracks food bought at grocery stores and markets to be consumed off premise.

Year-over-year, it rose by 2.7%.

This chart shows the price level of the CPI for food at home, not the percentage changes. Since January 2020, it has risen by 32%:

The CPI for energy plunged by 1.5% in July from June, driven by the plunge in gasoline prices, though prices for electricity and utility natural gas piped to the home rose.

Year-over-year, it was still up by 14.4%. And since January 2020, it has soared by 43%. The chart shows the price level, and not the percentage change.

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