EDITORS NOTE: EDS: SUBS to expand and revise throughout; SUBS headline; ADDS contributor line.); (ART ADV: With photo.); Tony Romm contributed reporting.

NEW YORK -- A key measure of underlying inflation rose in July as businesses grappled with President Donald Trump's tariffs, although the overall increase was likely not significant enough to deter the Federal Reserve from lowering interest rates at its next meeting.

The consumer price index stayed steady at 2.7% compared with the same time last year. On a monthly basis, prices rose 0.2% from June. But an important gauge tracking consumer prices that strips out volatile food and energy prices accelerated more rapidly.

"Core" CPI, which is closely watched by the central bank, jumped 0.3% over the course of the month, or 3.1% on a year-o

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