Inflation stayed steady last month as tariffs hit some prices — here’s what might feel most expensive
Inflation didn’t improve last month, suggesting that businesses may be starting to pass along higher costs from tariffs onto the prices that you see on store shelves.
Consumer prices rose 0.2% between June and July, according to the Bureau of Labor Statistics’ latest monthly consumer price index report. Excluding food and energy, a measure of “core” or “underlying” inflation rose 0.3%, the most since January. Many items currently exposed to tariffs – from coffee and tomatoes to toys, sporting equipment, household furnishings and apparel – continued to climb. Used cars and trucks rose the most since September 2022.
More price hikes could also still be coming down the pipeline after higher tariff rates from key U.S. trading partners took effect earlier this month.
The majority of economists (41%) expect inflation to stay elevated through 2027, primarily driven by higher import taxes, according to Bankrate’s latest Economic Indicator Survey. Meanwhile, Fed officials have said that uncertainty over how tariffs could impact inflation is the main reason rate cuts are on hold.
A little bit of inflation is good for consumers. The economy keeps growing and businesses continue expanding, hiring workers and bumping up their pay along the way. Too much inflation, however, feels akin to taking a pay cut. High inflation has consequences beyond just affordability, complicating saving for emergencies or investing for retirement.
Since the pandemic, consumer prices are 24.3% more expensive, a Bankrate analysis of Bureau of Labor Statistics data shows. That price burst means Americans need about $1,243 to buy the same goods and services that cost $1,000 when the coronavirus-induced recession occurred.
Looking for the latest information on consumer prices? Here’s a round-up of where inflation is improving – and where it’s still remaining stubborn.
What is the current inflation rate?
Over the past 12 months, prices have risen 2.7% from a year ago, the BLS’ CPI report showed. Excluding food and energy, “core” prices rose 3.1% annually.
Inflation is well below where it peaked in the summer of 2022. Yet the figures reflect bumpier progress on inflation’s path back to the Fed’s 2% target. Inflation was staying stubbornly above the Fed’s goal even before President Donald Trump lifted tariffs to the highest since the Great Depression.
Prices that are rising the most
Of the nearly 400 items that BLS tracks, roughly 3 out of every 4 items (or 76%) increased in price between July 2024 and July 2025. One in 4 (or 25%) were cheaper in July than they were a year ago.
According to BLS, these are the prices that increased most over the past year (July 2024-July 2025 increase):
Eggs: 16.4%
Roasted coffee: 14.8%
Instant coffee: 14.3%*
Utility (piped) gas service: 13.8%
College textbooks: 12.9%*
Uncooked beef steaks: 12.4%
Audio equipment: 12.4%
Other condiments: 12.1%
Uncooked ground beef: 11.5%
Beef and veal: 11.3%
(* Denotes an item that isn’t seasonally adjusted.)
Month-over-month price changes, however, can give consumers a more real-time look at the prices that have recently been popping. Lower prices in the same year-ago period, for example, can cause an item to look like it’s gaining speed, when it’s slowing in reality.
Case in point: Utility piped gas services prices were cheaper in July than they were in June, even though they’re still up 13.8% from a year ago.
Consumers, however, should take seasonal variations into account. Back-to-school or tax season, for instance, can often contribute to higher prices on items like tax return preparation services or college textbooks. BLS doesn’t seasonally adjust all of its items, and year-over-year inflation rates can better smooth out those variations.
Why is inflation still hot right now?
Consumers might notice just how much more expensive egg prices are from a year ago and wonder why the overall inflation rate is just 2.7%. To put it simply, the Bureau of Labor Statistics assigns weights to each individual good or service it tracks, based on how prevalent it’s considered to be in a consumer’s monthly budget.
Yet, in a sign that tariffs are contributing to the recent increase in inflation, core goods prices (excluding food and energy) accounted for one-fifth (or 20%) of overall inflation between June and July.
The drivers of inflation have changed dramatically since the initial post-pandemic price burst. When price pressures peaked in June 2022, shelter contributed just 20% of the annual increase in prices. But as consumers emerged from lockdowns with massive pent-up demand at the same time as global supply shortages, goods prices were driving the majority of price pressures, accounting for more than half (58%) of inflation between June 2021 and 2022. Energy was also responsible for about a third (32%) of inflation.
To combat inflation, officials on the Federal Reserve lifted borrowing costs from a rock-bottom level of near-zero percent to a 23-year high of 5.25% to 5.5%. Now, borrowing costs are in a target range of 4.25% to 4.5%.
Inflation breakdown by product category
Looking for an easy analysis of how inflation is impacting the key items in your budget? Here’s what Bankrate found.
Gas
Prices aren’t rising as rapidly as they once were. Technically, prices are 9.5% cheaper than they were a year ago – after soaring as high as 59.8% in June 2022. Even so, prices at the pump cost about 15.3% more than before the pandemic.
Energy prices, however, tend to be volatile. For instance, gas prices declined 2.2% in July after a 1% increase in June.
Food
Grocery prices rose 2.2% from a year ago and are about 28% more expensive than they were before the pandemic, BLS data indicates. At their peak, grocery prices soared 13.6% in August 2022 from a year ago.
Of the major shopping categories:
Meats: up 5.7% over the past year and 34.6% since February 2020.
Fish and seafood: up 1.7% from a year ago and 17.9% since the start of the pandemic-induced recession.
Dairy: up 1.5% over the past year and 21.4% more expensive since the pandemic.
Fruits and vegetables: up 0.3% over the past year but 18.1% more expensive than before the pandemic.
Sugar and sweets: up 5.1% from a year ago and 35.6% since the pandemic.
Meanwhile, the price of dining out at a restaurant increased 4.4% from a year ago, capping off a 31.7% increase since the pandemic.
Rent
Rent has become a key corner of inflation – and one of the costliest categories of a consumer’s budget. Prices, however, may finally be slowing, at least gradually.
Rent of primary residence rose 0.3% between June and July 2025, a clear cooldown from the post-pandemic peak of 0.8%. Over the past year, rents have risen 3.5%, now the lowest since the end of 2021.
Even so, Americans who’ve had to sign new leases since the outbreak are feeling the pinch: Rent is up 28.9% since the pandemic.
Rent prices have remained hotter than most economists and Fed officials originally expected. Lags could be one reason, as leases and housing agreements take longer to roll over from the previous year. Another could simply be because homes and mortgage rates have stayed pricey, keeping more renters on the sidelines than usual.
Vacations
Inflation hasn’t just made the prices of key household essentials more expensive but the costs of vacations and travel, too. Airline ticket prices, for example, once soared as much as 43% from a year ago in September 2022.
Those prices are back to following the ebbs and flow of travel season, though consumers might still be experiencing some sticker shock:
Airfares: up 0.7% from a year ago but 8.1% cheaper than in February 2020.
Car and truck rental: up 0.7% from a year ago, matching some of the biggest increases since 2022, and now 20.8% more expensive since the pandemic.
Hotels and motels: down 4.8% from last year and 5.1% more expensive than before the pandemic.
Car ownership
Owning a car has been especially pricey since the pandemic, from the cost of the car itself and the interest rates that finance it to the repair and insurance costs required for upkeep. Making car inflation hard to escape, the majority of households (roughly 92%) owned at least one car in 2022, according to the Census Bureau.
Motor vehicle insurance: up 5.3% from a year ago and 56.6% since the start of the pandemic.
Vehicle repair: up 11% from a year ago and 58.4% since February 2020.
New vehicles: up 0.4% from a year ago but still 19.8% more expensive since February 2020.
Used vehicles: up 4.8% since July 2024, the biggest increase since September 2022, and 30.5% more expensive since the pandemic.
Leased vehicles: up 0.2% in July from a year ago but 34.2% more expensive since the start of the pandemic
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Takeaways for consumers
Slowing inflation in 2024 gave the Fed room to cut interest rates and consumers a chance to recover some of the purchasing power that they lost. Even so, prices are still higher today than they would’ve been had the pandemic not occurred, and the Fed remains worried tariffs could reignite inflation.
• So long as inflation stays high, so will the borrowing costs you pay: The U.S. central bank’s key benchmark interest rate is still higher than at any point since the Great Recession – keeping borrowing costs elevated on the products consumers pay, from credit cards and auto loans to home equity lines of credit (HELOCs).
• Comparison shop as much as you can: Consumers know to compare offers from multiple lenders before locking in a loan. Why not the same for the items you buy on a regular basis? Compare prices at multiple retailers, see if any stores offer price match and craft a budget. If a product or ingredient pushes your spending goal over the edge, consider swapping it out for something else.
• Use the personal finance tools at your disposal: Finding the right credit card that helps you earn rewards on the purchases you were already going to make can be another way to pad up your wallet. Just be sure you’re not carrying a balance. A 20% interest rate will never outweigh the cash back.
• Save for emergencies and find the right account: Historically, investing in the stock market has been the best way to beat inflation over time, but higher rates mean savers can find a market-like return without any of the risk. Deposit rates have already fallen after the Fed’s rate cuts, but returns on high-yielding accounts are still beating inflation. Stash your cash in a high-yield account or add a certificate of deposit to your portfolio, so you can lock in these elevated yields for the long haul.