U.S. annual core inflation accelerated to 2.2% in July from 2.1% in June, data from the U.S. Bureau of Labor Statistics showed.
The consensus estimate of economists polled by Econoday was for no change.
On a monthly basis, core inflation, which excludes food and energy, came in at 0.3% in July, indicating similar growth to that in June. Prices of shelter, medical care, airline fares and apparel rose, while that of new vehicles fell, among others.
The broader U.S. consumer price index accelerated 1.8% year over year in July, higher than the Econoday consensus estimate of 1.7% and June's growth rate of 1.6%. Energy prices declined 2% on a yearly basis, while food prices climbed 1.8%.
On a monthly basis, the index ticked up 0.3% in July from 0.1% in June, primarily due to a rise in prices of gasoline and shelter.
The U.S. Federal Reserve targets 2% annual inflation.
"Despite the firmer July core CPI print, we do not see the reading fundamentally changing the calculus for the Fed," Oscar Munoz, a macro strategist at TD Securities, wrote in a research note. "We continue to expect the Fed to deliver cuts at its September and October FOMC meetings, with global growth, manufacturing, and trade remaining key concerns."