Politico:

Inflation ticks higher as Trump's tariffs kick in

"Bad prediction": The president derided economists' forecasts for higher inflation.

Consumer prices edged higher in July as President Donald Trump's tariffs began to push up the cost of everyday household goods.

The consumer price index climbed at an annual rate of 2.7 percent, slightly lower than expected, thanks to sharp declines in gasoline and energy prices, the Labor Department reported Tuesday. But so-called core inflation -- which excludes volatile food and energy costs -- rose above 3 percent for the first time in six months as more businesses began to pass along the cost of the administration's tariffs to American consumers.

With the administration touting the nearly $130 billion collected from new import levies -- and with new, heavy-duty taxes on goods from dozens of trading partners now in effect -- there is a broad expectation that more companies will saddle consumers with the additional costs in the coming months.

That could complicate the Federal Reserve's path to lowering interest rates as the central bank also reckons with growing signs of trouble in the labor market. While investors widely assume that policymakers will lower rates at their September meeting, the Fed's ability to keep cutting will depend on tariff-related price increases remaining limited.

Trump derided predictions by economists of higher inflation, and the White House said the CPI report was a sign that his program is working.

"The Panicans continue to be proven wrong by the data -- President Trump's tariffs are raking in billions of dollars, small business optimism is at a five-month high, and real wages are rising," press secretary Karoline Leavitt said in a statement.

Still, most economists anticipate the president's trade agenda will continue to push up consumer prices.

Well, if that's what the experts are saying, I imagine that's exactly what will happen. They've never been wrong before.

"We expect [core inflation] will rise further to a peak of 3.8 percent by the end of the year as tariffs bleed through more fully to consumer prices," said Michael Pearce, deputy chief U.S. economist at Oxford Economics. "The upside risks to inflation will keep the majority of the Federal Open Market Committee preferring to sit on the sidelines for a few more months."

Goldman Sachs economists estimate that consumers absorbed just 22 percent of tariff costs through June, while businesses ate up nearly two-thirds of the levies. But they expect the consumer share to soar to 67 percent by October -- based on how previous import duties affected prices -- and that domestic producers will also raise prices.

For months, the media and the Democrats -- but I repeat myself, again -- have been blowing off the falling inflation rate insisting that Trump had done nothing to reduce food prices, specifically.

Food prices come in at 0.0% -- flat as Dylan Mulvaney -- and now they're focusing on core inflation.

In fairness, though, CNN did mention the falling fuel prices and flat food prices.