Inflation rose 0.2% in June, less than expected

The June Consumer Price Index shows inflation continues to cool. Both the headline and core numbers rose 0.2 percent month-over-month in June. On an annual basis, prices rose 3 percent, and when food and energy are excluded, prices rose 4.8 percent. Yahoo Finance Live breaks down the report.

Video Transcript

- Well, let me just run through these numbers real quick. So CPI, rising month-over-month, 0.2%. That is double what was estimated. However-- excuse me, that was double the prior month, but better than estimated core numbers, excluding food and energy also coming in with a gain of 0.2% here. That is better than estimated.

In other words, we are seeing a more moderate pace of inflation on both the headline and the core than had been estimated on a month-over-month basis, year-over-year seeing headline inflation rise 3.0% and seeing core inflation, excluding food and energy, up by 4.8%. So overall, this showing some welcome news for consumers here in the United States that we are seeing this pace moderate a little bit.

- Yeah. And a couple of the themes that are going to continue to come up in discussions today. Here, context around this the index for shelter, that has remained sticky here to say the least. The index for shelter, largest contributor to the monthly all items increase, that accounted for over 70% of that increase.

And then the index for motor vehicle insurance also contributing. You mentioned food index as well. That increased about 1/10 of in June after increasing 2/10 of a percent versus the previous month. So some moderation there in a good way there. And then the energy index, too, something that a lot of consumers out there are paying close attention to here, this summer. That rose 6/10 of in June as the major energy component indexes were mixed here as well, Julie.

- Yeah, another big area of focus was on used cars and trucks, seeing a decline there of a half a percent month-over-month. New vehicle's flat, no change there. But we're going to dig much more into the vehicle picture a little bit later on. I'm just scanning through some of the other numbers here, seeing a big decline in gas service, utility service.

That is not gasoline but rather natural gas, down by 1.7%. So that's one of the areas where we're seeing improvement, and fuel oil down 0.4%. Although, in the summer months, you're not seeing as much of a use for fuel oil, but gasoline prices, as you pointed out, are seeing a gain. 1.0% was the gain there. And I'm just looking to see if there are any other areas where we're seeing big increases. Not really seeing a lot of other large increases here on a month-over-month basis.

- Yeah, just lastly, before we get some of our guests involved in this conversation, too, taking a look at the futures here this morning, as we are still just a little over an hour out from the start of trade here on the day. We're taking a look at the futures. We've got them here on your screen for you.

We're higher across the board. As of right now, fractional gains for the Dow and the S&P 500, up by about half a percent more than that for the Dow. The S&P 500 still up by about 3/4 of a percent. And the NASDAQ futures up by about 9/10 of a percent right now.

- Yeah, the read through, perhaps, being that while the Fed's next interest rate increase at the end of the month is pretty much a foregone conclusion on the part of most investors. What happens beyond that could, indeed, be affected by this number and some of the other inflation numbers that will be coming. So that's something that we will be closely watching.