Yahoo Finance Consumer prices increase 0.1% in June, matching expectations
July 11 (UPI) -- The consumer price index, a key indicator looked at by the Federal Reserve, declined a seasonally adjusted 0.1% in June from last month and 3% for the past 12 months, according to the latest figures from the Labor Department released on Thursday.
The monthly CPI figure matched the expectations of Dow Jones economists. In contrast, the year-to-year figure was slightly under the 3.1% Wall Street had predicted, giving some room for the Fed to think about possible interest rate cuts.
The CPI Summary said the gasoline index tumbled by 3% in June, following a 3.6% decline in the index in May. That was able to offset an increase in shelter. The food index for June increased by 0.2%.
The index for the core items, minus more volatile food and energy, increased by 0.1%. The core items, another indicator watched closely by the Feds, rose 0.2% in May.
"The level on inflation is still elevated relative to the Fed's [2%] target," Matt Brenner, managing vice president of investments and product manager at MissionSquare Retirement, told CNBC. "The level on unemployment is still very low historically at 4.1%.
"But the trend in both is that unemployment is gradually starting to pick up and that inflation continues its downward trajectory for some time, the Fed has been more focused on levels, and now it seems that they may be starting to tilt more towards a focus on trend. And if that's the case, then the chances of a rate cut go up."
Federal Reserve Chairman Jerome Powell hinted at such during his report to the Senate on Tuesday but stressed the board's main goal continued to be getting inflation to that 2% mark.
"We know that reducing policy restraints too soon or too much could stall or even reverse the progress we have seen on inflation," Powell told a Senate committee. "Reducing policy restraints too late or too little could unduly weaken economic activity and employment."
Last month, consumer prices were flat for the first time all year, unchanged from April to May while the all items index jumped 3.3% from May 2023.
