New data from the Department of Labor reveals that the national cost of living rose in July, while average weekly earnings decreased, and real wages hit a six-year low.
The data from the Labor Department accounts for inflation, finding that average weekly earnings dropped 0.2 percent month-over-month in July, and posted "fractional" growth year-over-year, per CNBC. Meanwhile, the pace of core inflation was the fastest in a decade. Ian Lyngen, head of U.S. rates strategy at BMO Capital Markets, says, "It was the real-wage story that caught our attention," adding that the low level "speaks to the 'ugly side of reflation' as it undermines consumers' real purchasing power."
Gross domestic product rose 4.1 percent in the second quarter, the best gain in nearly four years, and is on pace to grow 3.4 percent in the third quarter, according to CNBC's Rapid Update gauge of economist estimates. Job growth also has been solid, with July's gain of 157,000 in non-farm payrolls a blip in an otherwise strong year for growth. Payrolls have risen an average of 215,000 a month in 2018, the best pace since 2015 and 30,000 per month ahead of the same period in 2017.