US Inflation Holds Steady July Amid Fed Rate Cut Pressure

US inflation remained steady at 2.7% year-over-year in July, matching June's rate, with core inflation rising to 3.1%, the fastest pace since February, highlighting underlying price pressures partly due to tariff increases. Despite calls from President Trump for the Federal Reserve to cut interest rates to stimulate the economy, Fed Chair Jerome Powell has resisted, citing concerns that lowering rates could inadvertently benefit Trump's economic standing and accelerate inflation. Trump escalated tensions by threatening to sue Powell over the Fed's $2.5 billion headquarters renovation and continuing to demand immediate rate cuts. Analysts note that while headline inflation remains controlled, the impact of tariffs on consumer prices is becoming more apparent, potentially leading to ongoing inflationary pressures. The Fed faces a difficult balancing act amid mixed economic signals, including steady inflation, rising core prices, and a cooling labor market, making future monetary policy decisions challenging. Economists and strategists remain divided, with some expecting a rate cut in September, while others warn that tariff-induced price hikes could complicate efforts to ease borrowing costs.