US inflation at 3.4%; focus shifts to Fed September decision

Every month, the government checks how much prices for everyday things like food, gas, and rent have gone up.

This is called inflation, and it tells us how much more money we need to buy the same stuff.

In the United States, prices went up 3.4% compared to one year ago in July.

That is a little less than last month, when prices had gone up 3.5%.

In fact, prices even went down a tiny bit in June, which was the first drop in many years.

Energy prices were the big exception — they jumped a lot over the past year, mostly because of tensions in the Middle East.

Food prices went up more slowly, just 3% over the year.

The people who set interest rates for the country, called the Federal Reserve, watch these numbers closely.

Since inflation is cooling down, they may decide not to raise rates at their next meeting in September.

This could be good news for people who buy stocks, because cooling inflation often helps the stock market.