According to the Bureau of Labor Statistics, the seasonally adjusted consumer price index (CPI) rose by 0.2% in July, significantly lower than what most economists expected. Overall inflation over the last 12 months stood at 2.7%, the same as in June. And this happened despite a 9.5% drop in gasoline prices, which historically has a very high correlation with inflation. Inflation in this century rose above 4% only during 2005 and 2008, before spiking dramatically to over 9% by 2022. This surge was almost entirely driven by massive government transfer payments, which significantly raised personal consumption expenditures.