The U.S. sanctioning of a prominent cryptocurrency platform this week exposed technical gaps in the government’s ability to prevent criminals, national adversaries and extremist groups from using the services to launder money and finance their operations, analysts said.

Among the central challenges: Cryptocurrency platforms are increasingly run by computer code distributed across

Politics: The FBI's effort to get documents from former President Donald Trump's Florida home escalated sharply this summer. 

Economy: The Labor Department is set to release data on producer prices for July and initial jobless claims for the week ended Aug. 6.

The Russia-Ukraine War: Kyiv is building forces outside Kherson, even as larger battles continue in the eastern region of Donbas.

The pace of price increases slowed in July as energy costs dropped, pulling annual U.S. inflation down slightly from a four-decade high. The Labor Department on Wednesday said the consumer-price index, a measure of what consumers pay for goods and services, rose 8.5% in July from the same month a year ago, down from 9.1% in June. June marked the fastest pace of inflation since November 1981. On a monthly basis, the CPI was flat in July after rising for 25 consecutive months, the result of falling energy prices such as gasoline, Gwynn Guilford reports.

Consumers are likely to travel and spend more because U.S. national gasoline prices have fallen for weeks, economists said, delivering an expected boost to the economy.

The average cost of a gallon of regular unleaded gasoline fell to $4 on Wednesday, according to energy data provider OPIS. That is well below the record high of $5.02 reached in mid-June but still about 80 cents a gallon higher than prices were a year ago.

WASHINGTON—The federal deficit narrowed by 30% in July compared with a year earlier, as the government reported a $211 billion monthly gap between revenue and spending.

The drop in the deficit this year is the product of the end of a burst of federal spending last year and rising government revenue this year. Government outlays fell 15% to $480 billion in July after programs administered last year such as expanded unemployment benefits ended, the Treasury Department said Wednesday. Government revenue, not adjusted for calendar differences, rose 3% to $269 billion.

Data on inflation and economic activity are likely to guide whether central bank officials lift their benchmark federal-funds rate by half a percentage point or three-quarters of a point at their Sept. 20-21 policy meeting. They have said they want to see evidence that price pressures and economic growth are cooling before they moderate their pace of rate increases.

The consumer-price index rose 8.5% from a year earlier, the Commerce Department said Wednesday, slowing from June’s 9.1% pace and a bit below expectations. This was thanks largely to declining gasoline prices. According to AAA, the national average price for regular unleaded gasoline is now $4.01, down from $4.68 a month ago. Gasoline futures have declined by even more, suggesting further retail price cuts ahead.

WASHINGTON—The collapse in cryptocurrency prices this year has left U.S. regulators scrambling to understand the risks that digital-asset markets could pose to the broader economy.

They may soon enlist hedge funds in the effort.

Politics: Former President Donald Trump wrote on social media that he is set to meet with the New York attorney general today. The FBI search of his Florida home over sensitive documents could roil the November midterm elections and raise rare legal issues.

Biden Administration: President Biden is scheduled to sign into law at 10 a.m. ET a bill expanding veteran healthcare benefits. At 12:30 p.m. he is set to depart the White House for Charleston, S.C.

Economy: The Labor Department is scheduled to report the consumer-price index at 8:30 a.m. Follow our live coverage here.

China’s central bank said it won’t flood the economy with excessive liquidity while trying to realize the best results for the economy this year.

The People’s Bank of China said in its second-quarter monetary policy report Wednesday that it would step up support for the economy by reiterating existing measures.

The central bank said in the...

U.S. labor productivity fell for the second straight quarter this spring while labor costs climbed, a bad sign for Federal Reserve officials trying to get inflation back under control. U.S. nonfarm labor productivity—a measure of goods and services produced per hour worked—fell at a seasonally adjusted annual rate of 4.6% in the second quarter from the prior quarter, the Labor Department said Tuesday. Unit labor costs, a measure of worker compensation and productivity, increased at a 10.8% pace in the second quarter from the prior quarter. The quarterly figures are volatile but the latest numbers follow a 7.4% productivity pullback in the first quarter, the sharpest drop in 74 years. "The Fed simply can't get to 2% inflation with this sort of productivity and wage growth," said Wells Fargo economist Sarah House.

U.S. inflation likely remained close to a four-decade high in July despite cooling energy prices, economists say.

The Labor Department on Wednesday is estimated to report that the consumer-price index rose 8.7% in July from the same month a year ago, down from 9.1% in June, according to economists surveyed by The Wall Street Journal. June marked the fastest pace of inflation since November 1981.

Thailand’s central bank raised its policy rate for the first time in nearly four years in a bid to help control inflation.

The Bank of Thailand said Wednesday that its policy committee voted six to one to increase its one-day repurchase rate by 25 basis points to 0.75%, effective immediately. It was the first increase since December 2018. One member voted to raise the policy rate by 50 basis points, the central bank said.

All...

Politics: FBI agents searched Former President Donald Trump's Mar-a-Lago home in Florida in a document investigation. 

Biden Administration: President Biden is scheduled at 10 a.m. ET to deliver remarks and sign into law a bill aimed at boosting the semiconductor industry. At 2 p.m. Mr. Biden is expected to sign the ratification of the addition of Finland and Sweden to NATO.

Economy: U.S. nonfarm labor productivity data due to be released at 8:30 a.m. is expected to have fallen for the second straight quarter.

Broad new data on wages earned by college graduates who received federal student aid showed a pay gap emerging between men and women soon after they joined the workforce, even among those receiving the same degree from the same school. The data, which cover about 1.7 million graduates, showed that median pay for men exceeded that for women three years after graduation in nearly 75% of roughly 11,300 undergraduate and graduate degree programs at some 2,000 universities. In almost half of the programs, male graduates’ median earnings topped women’s by 10% or more, a Wall Street Journal analysis of data from 2015 and 2016 graduates showed.

Economists who have long examined pay gaps between men and women cite the so-called motherhood penalty—referring to the perception that mothers are less committed to their jobs—and say this affects hiring, promotions and salaries. Determining why those gaps appear earlier isn’t simple. The federal data don’t account for such...

Workers’ wages are rising briskly, a factor contributing to four-decade high U.S. inflation.

Average hourly earnings grew 5.2% in July from a year earlier, and annual wage gains have exceeded 5% each month this year, the Labor Department said Friday. The rapid earnings growth adds to other evidence that employers are continuing to increase pay as they try to find and keep workers in a tight job market.

Americans are expecting less inflation in coming years, according to a recent survey by the Federal Reserve Bank of New York.

Respondents’ median expectation in July was for an annual inflation rate of 6.2% in one year, down from the 6.8% they expected in June, the regional reserve bank said Monday. They expected inflation in three years to be at 3.2%, down from the 3.6% they expected in June, and inflation in five years to be at 2.3%, down from a previous 2.8%.

Supermarket chain Karns Foods says it is getting ready for a recession.

The family-run company in Mechanicsburg, Pa., is carrying more low-cost food brands and dropping some expensive products altogether. The grocer removed quart-size heavy cream products from some stores as they became more expensive and put less expensive store brands and smaller packages on shelves instead.