Inflation cooled last month as gas prices fell, though costs...

U.S. inflation cooled in July, but not enough to fully erase concerns that energy shocks could linger. Consumer prices rose 3.4% year over year, down from 3.5% in June, while the monthly increase was just 0.1%. Core inflation—excluding food and energy—also eased to 2.5% from 2.6%, with core prices up 0.2% from June. The report suggests the Federal Reserve may be able to keep its key interest rate around 3.6% while inflation declines on its own as temporary factors fade, though officials remain divided. Gas averaged $4.04 a gallon nationwide, up 16 cents from a month earlier, after gasoline fell 2.9% in the monthly comparison. Prices were still higher than in February, before the Iran war began.