United States: Inflation rises in June
Latest reading: Inflation increased to 2.7% in June, following May’s 2.4% and moving further above the Fed’s 2.0% target. Looking at the details of the release, food prices rose at a quicker pace in June compared to the previous month, while transport prices fell at a softer rate.
Annual average inflation edged down to 2.6% in June (May: 2.7%). Meanwhile, core inflation ticked up to 2.9% in June from May’s 2.8%.
Finally, consumer prices rose 0.29% in June over the previous month, picking up from May’s 0.08% increase. June’s figure was the highest reading since January.
Panelist insight: Digging deeper into the month-on-month data, Nomura analysts said:
“In line with our forecast, vehicle prices continued to decline. Higher prices of apparel products and sporting goods were also consistent with our expectation. Conversely, prices for household furnishings & suppliers were surprisingly strong, rising by 1.0% m-o-m, led by higher prices for appliances, linen products, and nonelectric cookware and tableware. In our analysis, most goods prices which rose in June are sensitive to tariffs, and we think that the impact of tariffs on inflation will likely materialize further in coming months.”