Traders work on the floor at the New York Stock Exchange in New York, Monday, July 6, 2026. (AP Photo/Seth Wenig)
The economy, inflation and how those forces could impact the lives of Americans were front and center over the past week. Trips to the grocery store and gas station are more painful than they were last year, and rising costs are impacting the decisions of both households and businesses.
Here’s a snapshot of prominent economic data and news that occurred over the past week and what it potentially means for you.
American consumers — and the Federal Reserve — are being hit with another high-cost headache.
The gusher of investment in data centers — likely topping $700 billion this year — to power artificial intelligence has made memory chips, computer processors, and other equipment, as well as electricity, more expensive. Economists expect it will continue to push up inflation at least through the end of this year.
While it won’t be as large a spike as occurred in 2021-2023, when inflation peaked at 9.1%, massive AI spending is likely to keep prices rising more quickly than the Federal Reserve would like. Such increases could lead the central bank to lift its key interest rate later this year to cool spending and bring down inflation. Higher rates from the Fed often boost borrowing costs for auto loans, mortgages, and business loans.
U.S. inflation cooled last month as the cost of gas, clothes, and used cars fell, providing some relief to consumers, while underlying price pressures also cooled more than expected.
Prices dropped 0.4% in June from May, the largest monthly drop in four years, the Labor Department said Tuesday. On a yearly basis, inflation declined to 3.5%, down from a year-over-year gain of 4.2% in May and lower than many economists expected.