Is America’s inflationary fever breaking?

Writing out economic figures to the third decimal place is normally an exercise in spurious precision. But after two years of uncomfortably high inflation, price statistics are studied in minute detail. The unrounded month-on-month increase in America’s core inflation (minus volatile food and energy costs) in June was 0.158%, even more pleasing for officials than the 0.2% rounded increase, which itself was the slowest pace in more than two years. However many decimal places, the question remains the same. Is America’s inflationary fever finally breaking?The latest figures brought much good news. Headlines focused on the deceleration in the overall consumer-price index: just a 3% year-on-year rise in June, a sharp slow down from the 9% pace of June 2022, thanks largely to a fall in energy prices. Yet a range of measures of underlying inflation also looked appealing. Most notably, prices for core services excluding housing—a category to which Jerome Powell, chairman of the Federal Reserve, often points as an indicator of underlying inflationary momentum—fell slightly in June compared with May.