US inflation slips from 40-year peak but remains high 8.5%

Gas prices are displayed at a Sunoco gas station along the Ohio Turnpike near Youngstown, Ohio, Tuesday, July 12, 2022. (AP Photo/Gene J. Puskar, File)

Falling gas prices gave Americans a slight break from the pain of high inflation last month, though the surge in overall prices slowed only modestly from the four-decade high it reached in June.

Consumer prices jumped 8.5% in July compared with a year earlier, the government said Wednesday, down from a 9.1% year-over-year jump in June. On a monthly basis, prices were unchanged from June to July, the smallest such rise in more than two years.

Still, prices have risen across a wide range of goods and services, leaving most Americans worse off. Average paychecks are rising faster than they have in decades — but not fast enough to keep up with accelerating costs for such items as food, rent, autos and medical services.