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US price and wage increases slow further in the latest signs of cooling inflation

Edwin Lopez sorts the money in the cash register at Frankie's Pizza on Jan. 12, 2022, in Miami (Joe Raedle/Getty Images)

WASHINGTON (CNN) — US consumers have been feeling a whole lot better this summer as inflation has continued to slow.

Consumer sentiment tracked by the University of Michigan rose 11% in July from the prior month, reaching its highest level since October 2021, according to a final reading of the month’s data. That’s a huge improvement from June 2022, when consumer sentiment fell to its lowest level on record and inflation reached a four-decade high of 9.1%.

Americans’ expectations for inflation rates in the year ahead inched up to a 3.4% rate, “well below the high point of 5.4% from April 2022 but above the 2.3%-3.0% range seen in the two years prior to the pandemic,” according to a release.

“Overall, the sharp rise in sentiment was largely attributable to the continued slowdown in inflation, along with stability in labor markets,” said the University of Michigan’s Director of Surveys, Joannu Hsu, in a release. “However, sentiment for lower-income consumers fell.”

This story is developing and will be updated.