The rate of US consumer price inflation had increased in July, making the annual rate of inflation to 2%, which is the expected figure by the Federal Reserve.

inflationConsumer prices rise

That was higher by 0.2% from the last month, with petrol prices still increasing.

The US Department of Labor said prices of housing, food, and clothing had all increased adding to inflation.

Analysts said the rate did not lower the expectation that the Fed would start rolling back its economic stimulus measures in the near future.

“There’s nothing in [the] release to prevent the Fed from tapering [its stimulus programme], probably next month,” said Paul Dales, senior US economist at Capital Economics.

Inflation rate still mild

US Central Bank Chairman Ben Bernanke sees the latest low inflation rate as temporary, and sees both growth and prices picking up later this year.

Before, the Fed said it planned to maintain the short-term interest rate at a record low until the jobless rate decreased by 6.5%, provided inflation stayed under control.

Analysts do not expect a rate increase in the near future, but increasingly expect the Fed to start winding down its asset buying method, currently set at $85 billion per month.