U.S. CPI seen flat in July, core up 0.1 percent

Cheaper gasoline prices will likely temper U.S. inflation in July, with the rate on a year-over-year basis possibly at its lowest in more than 49 years, a Reuters survey showed.

Analysts surveyed by Reuters forecast the Consumer Price Index -- the most widely used measure of inflation -- would be unchanged in July from the previous month. That would follow June's 0.7 percent gain.

"Pricing pressures should continue to be contained as only tentative signs of a turnaround emerge," IHS Global Insight wrote in their outlook.

The core rate of inflation, which excludes food and energy and is considered a more reliable indicator, is expected to post a subdued 0.1 percent gain in July after rising 0.2 percent in June.

"Core consumer prices are likely to remain resilient, further dimming the threat of deflation," IHS Global Insight said.

Economists forecast year-over-year CPI down 2.0 percent, which would be the lowest level since January 1950 when it fell 2.1 percent, while the core rate is forecast up 1.6 percent, the lowest level since March 2004.