Consumer prices increased 2% year-over-year for the month ended July after a 2.1% year-over-year rise in June. The core measure was up 1.9% from July 2013. The Fed set a 2% inflation goal based on the Commerce Department’s price gauge that is tied to consumer spending, and the measure hit 1.6% in the 12 months through June.
“Lower inflation expectations also make inflation-hedging assets like TIPS less attractive,” according to Morningstar analyst Abby Woodham.
iShares TIPS Bond ETF
For more information on inflationary pressures, visit our inflation category.
Max Chen contributed to this article.