US inflation remains sticky in July

What the report says

US inflation stayed elevated in July, according to data published by the US Bureau of Economic Analysis and reported by Al Jazeera on 26 August 2026. The Personal Consumption Expenditures price index, the Federal Reserve’s preferred inflation gauge, rose 3.7 percent from a year earlier, unchanged from June and slightly above economists’ expectations. On a monthly basis, the index increased 0.2 percent after a 0.1 percent decline the previous month.

The report said core PCE inflation, which excludes food and energy, remained at 3.3 percent year on year while edging higher on the month. The figures added to speculation that the Federal Reserve could consider another interest-rate increase at its September meeting, with market pricing showing a higher chance of a hike after the release. Economists quoted in the report said the numbers supported that view.

Al Jazeera also noted that inflation has been affected by wider geopolitical and trade pressures. It said price growth worsened after the US and Israel attacked Iran, which helped lift energy costs, and that petrol prices have recently rebounded in the US. The article also pointed to fresh tariff-related uncertainty after US-Canada trade talks broke down, with both governments announcing new retaliatory measures. The broader significance is that persistent inflation may continue to squeeze household purchasing power and complicate the Fed’s path on rates.