CPI rose in July by 2.7% on an annual basis. Here's what that means.

The Consumer Price Index in July rose 2.7% on an annual basis, slightly cooler than economists had forecast.

By the numbers

The CPI was expected to rise 2.8% last month, according to economists polled by financial data firm FactSet.

On a month-over-month basis, the CPI rose 0.2%, in line with economists' forecasts.

The CPI, a basket of goods and services typically bought by consumers, tracks the change in prices on everyday items such as food and apparel over time. So far this year, inflation has stayed at 3% or lower. June's CPI reading was 2.7%.

So-called core inflation, a measure or CPI that excludes food and energy prices (which are more volatile), rose by 3.1% over the past 12 months, the highest level in five months. Economists polled by FactSet had predicted a 3% increase f