U.S. Consumer Price Index Rose 3.5 Percent Year Over Year in June

The Bureau of Labor Statistics reported that the consumer price index rose 3.5 percent year over year in June, down from 4.2 percent in May. Month over month, the index fell 0.8 percent, the largest one-month decline since April 2020. Gasoline prices dropped 9.7 percent from May to June and fuel oil prices fell 9.2 percent, accounting for most of the overall decrease.

Apparel prices declined 0.6 percent. Core inflation, which excludes food and energy, rose 2.6 percent year over year and was unchanged from the prior month. The Bureau of Labor Statistics attributed the decline primarily to lower energy costs.

The national average price for regular gasoline reached $3.87 per gallon last week, 70 cents higher than a year earlier. Brent crude touched a recent low of $67 per barrel earlier in July before rising to $80 per barrel on Monday.

Delta stated in its quarterly earnings last week that it expects high airfares to continue and has passed on 60 percent of extra fuel costs to consumers. The average number of jobs added to the U.S. economy each month from April through June was 111,000.

The Federal Reserve’s next board meeting is scheduled for July 28 and 29. Kevin Warsh, the new Fed chair, is set to testify before the House Financial Services Committee on Tuesday morning.