United States: Inflation stabilizes in June
July 15, 2016
Seasonally-adjusted consumer prices rose 0.2% in June over the previous month and mirrored the result observed in May. June’s print fell short of the 0.3% increase the markets had expected as higher energy prices (+1.3% month-on-month) were offset by lower food prices (-0.1% mom).
Inflation stabilized at May’s 1.0% in June, which prompted the annual average inflation to inch up to 0.7% in June from 0.6% in May.
Core consumer prices, which do not consider foodstuff and energy prices, rose 0.2% for the third consecutive month in June, matching market expectations. Core inflation remained unchanged at May’s 2.2% in June.
Although the Federal Reserve targets an alternative measure of inflation called the personal consumption expenditures price index—U.S. monetary authorities also follow the core inflation measure closely to judge whether inflationary pressures are increasing in the economy.
Author: Ricardo Aceves, Senior Economist