The consumer-price index, a measure of goods and services prices across the economy, rose 3.2% in July from a year earlier, up from 3% in the year through June, the Labor Department said Thursday. So-called core prices, which exclude volatile food and energy categories, rose by 4.7% in July from a year earlier, a slight cooling from June’s 4.8% increase.

The monthly figures, however, offered a more encouraging picture of current price trends. The CPI rose a mild 0.2% in July, same as in June. Even better, the core CPI, also increased just 0.2% in both months, suggesting inflation isn’t starting to resurge. Fed officials focus on core inflation because they see it as a better predictor of future inflation than the overall inflation rate.

The core CPI, in particular, could encourage the Fed to hold its benchmark interest rate steady at its September policy meeting. The new numbers lower the three-month annualized rate of core inflation to 3.1%, the lowest such reading in two years.

[Generally, the Fed looks more closely at the PCE price index as its main inflation gauge. That will come in a week or two, so don’t expect much in the way of hints until then. This uptick in overall CPI is not great news, but it’s not a harbinger of re-escalation either, at least not on its own. Housing and rent will likely be the main drivers of inflation for a while, and if those markets settle into equilibrium, we may be past the worst of the roaring inflation — at least until the next big-spending bill from Biden that stokes demand again without incentivizing supply. — Ed]