US consumer prices unexpectedly fell in June, drawing Fed closer to cutting interest rates
What caused US prices to fall last month?
US prices fell last month due to a decline in energy and goods prices, as well as a slight increase in food prices4. Cheaper prices at the pump and falling goods prices helped to slow overall inflation4. This, combined with a strong dollar and easing supply chain issues, contributed to the unexpected drop in inflation.
How much did inflation decrease in June?
In June, US inflation fell by 0.1% on a monthly basis, marking the first decline since May 2020. On an annual basis, prices rose by 3%, down from 3.3% in May. This decrease was largely driven by a drop in gas prices, which fell 3.8% from May to June.
What is the current annual CPI increase rate?
The current annual Consumer Price Index (CPI) increase rate for the 12 months ending May 2024 is 3.27%. This is a decrease from the June 2022 peak of 9.06%. Moderate inflation can still erode purchasing power and create uncertainty for businesses estimating future costs4.