CPI Continues to Cool in June, Building Case for Fed Rate Cut in September

The Consumer Price Index

• CPI declined 0.1% month-over-month in June, below expectations of a 0.1% increase

• Headline inflation rate eased to 3.0% year-over-year, lower than the expected 3.1%

• Core CPI (excluding food and energy) rose 0.1% month-over-month, better than the expected 0.2%

• Core CPI increased 3.3% year-over-year, the smallest increase since April 2021

• Gasoline prices dropped 3.8% in June, offsetting increases in shelter costs

• Shelter index rose 0.2% month-over-month, slowing from 0.4% in May

• Probability of a September Fed rate cut increased to 79.7% following the report

• Equity futures and bond prices rose, with the 10-year Treasury yield falling 8 bps

https://www.bls.gov/news.release/cpi.htm

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