Inflation eased for the second consecutive month after reaching a three-year high in May, according to an analysis from the National Association of Home Builders. As energy prices leveled, shelter remained the largest factor driving inflation, accounting for one-third of the annual increase and over two-thirds of the monthly increase. 

The Consumer Price Index (CPI) rose by 3.4% in July from a year ago, following a 3.5% increase last month, according to the Bureau of Labor Statistics’ latest report.

The index for shelter, which makes up more than 40% of the “core” CPI, rose by 0.1% in July, matching last month as the smallest monthly increase since January 2021. Both the index for owners’ equivalent rent (OER) and rent of primary residence (RPR) increased by 0.3% over the month.