Inflation slowed in July, showing Fed's rate hikes are working

Inflation slowed in July as gasoline prices dropped, a sign that the Federal Reserve's efforts to control spiraling prices are taking effect.

Consumer prices last month were unchanged, a drop from June's 1.3% increase, the Labor Department reported on Wednesday.

Still, the 8.5% annual increase showed prices remain painfully high for consumers. Prices for food and shelter continued to rise last month, although those increases were offset by falling energy costs.