The latest inflation figures from the United States fuel hopes that inflation has peaked there: the consumer price index (CPI) for all goods and services stopped rising in July after prices had increased by 1.3 percent in the previous month.

In a year-on-year comparison, they were only 8.5 percent higher.

Winand von Petersdorff-Campen

Economic correspondent in Washington.

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Christian Siedenbiedel

Editor in Business.

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The inflation rate was 9.1 in June.

Core inflation, adjusted for volatile food and energy prices, rose 0.3 percent in July, down from 0.7 percent in June.

Experts had expected a significantly higher increase.

Compared to the previous year, prices increased by 5.9 percent (core CPI).

The surprisingly positive development boosted the American stock exchanges, whose most important indices went into stock exchange trading with significant increases.

The Dow Jones index of industrial stocks temporarily rose 1.3 percent to 33,206 points.

The broader S&P 500 temporarily rose 1.7 percent to 4193 points.

The dollar exchange rate weakened with the euro trading at $1.0342 during the session.

Energy prices are having a dampening effect

In particular, falling energy and gasoline prices in the United States have dampened inflation.

Prices at gas stations, which are considered a particularly important indicator of price developments, have been falling for almost two months.

At the same time, the costs for rent are rising significantly and thus reducing the relief effect.

In general, the monthly comparison shows the following pattern: Goods tend to become cheaper, while services become more expensive.

Global delivery problems are becoming smaller and thus reducing the price pressure on goods, while services are becoming more expensive, partly because of the difficulties in finding suitable staff at the old wage levels.

However, prices for services are often more stubborn and carry the risk that higher prices will last longer.

Many citizens also seem to have the impression that inflation could ease: This is reflected in the inflation expectations measured by the Federal Bank of New York.

They fell significantly in July.

This is important because high inflation expectations could provoke additional rounds of wage and price increases and thus trigger an upward price spiral that is difficult to contain.

Those surveyed see high inflation of 6.2 percent in the coming year, but only 3.2 percent in three years and 2.3 percent in five years.

The Federal Reserve (Fed) wants to see inflation at the target level of 2 percent and has announced further rate hikes for September and thereafter.

The climax has probably been reached

"In view of prices at the pumps continuing to fall and increasing signs that the supply chain problem has been overcome, the peak of US inflation should be behind us with some certainty," said LBBW economist Dirk Chlench: "However, this does not mean that the specter of inflation will soon be over will be."

Meanwhile, inflation in Germany also fell in July – but probably only temporarily.

The Federal Statistical Office on Wednesday confirmed an initial estimate that the German inflation rate was 7.5 percent in July, after 7.6 percent in June and 7.9 percent in May.

"The main causes of the high inflation are still price increases for energy products," said Federal Office President Georg Thiel: "Since June 2022, two measures in the federal government's relief package have had a slight dampening effect on overall inflation: the 9-euro ticket and the tank discount.

The EEG surcharge was also abolished in July 2022.”