07/15/2025

With June CPI Increase, Fed's Inflation Fears Start to be Realized

Fed Chair Powell cited summer data as key in rates debate

Rising prices across an array of goods from coffee to audio equipment to home furnishings pulled inflation higher in June in what economists see as evidence of the Trump administration's increasing import taxes passing through to consumers.

Overall consumer prices rose 0.3 percent in June, a roughly 3.5 percent annual rate, after a 0.1 percent increase in May.

Economists - and Fed officials - say they were expecting inflation to gather pace this summer as the lagged impact of tariffs gets passed along by businesses, and the June data suggest central bank policymakers in particular may remain reluctant to cut interest rates until more information is at hand.

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