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Well, let's see how this plays out.
The Consumer Price Index rose 2.7 percent from a year earlier, as the global trade war started to bite.
Inflation accelerated in June as President Trump’s tariffs started to leave a bigger imprint on the economy, keeping the Federal Reserve on track to hold interest rates steady when policymakers next meet this month. The Consumer Price Index rose 2.7 percent from a year earlier, the swiftest pace since February, data released by the Bureau of Labor Statistics showed on Tuesday. That is slightly higher than expected and up from an annual pace of 2.4 percent in May.
“Core” inflation, which strips out volatile food and energy prices and is seen as a reliable gauge for underlying price pressures, also shifted higher. Those prices were up 2.9 percent from the same time last year. Over the course of the month, prices rose 0.3 percent, a notable pickup from a 0.1 percent increase in May. Core prices rose 0.2 percent.
The June data still reflects only the initial impact of Mr. Trump’s global trade war. Prices of products most exposed to tariffs, like household furnishings, jumped 1 percent, significantly higher than the 0.3 rise last month. Prices for appliances, specifically, rose 1.9 percent, up from 0.8 percent. The apparel index increased 0.4 percent, snapping multiple months of declining prices. Gasoline prices rose 1 percent in June, after falling 2.6 percent the previous month. Grocery prices also rose, ticking up 0.3 percent in June.
Economists expect price pressures to intensify over the coming months, especially if new tariffs the president has threatened against the European Union and a host of other countries in recent days are imposed on Aug. 1 as planned.
The Consumer Price Index rose 2.7 percent from a year earlier, as the global trade war started to bite.
Inflation accelerated in June as President Trump’s tariffs started to leave a bigger imprint on the economy, keeping the Federal Reserve on track to hold interest rates steady when policymakers next meet this month. The Consumer Price Index rose 2.7 percent from a year earlier, the swiftest pace since February, data released by the Bureau of Labor Statistics showed on Tuesday. That is slightly higher than expected and up from an annual pace of 2.4 percent in May.
“Core” inflation, which strips out volatile food and energy prices and is seen as a reliable gauge for underlying price pressures, also shifted higher. Those prices were up 2.9 percent from the same time last year. Over the course of the month, prices rose 0.3 percent, a notable pickup from a 0.1 percent increase in May. Core prices rose 0.2 percent.
The June data still reflects only the initial impact of Mr. Trump’s global trade war. Prices of products most exposed to tariffs, like household furnishings, jumped 1 percent, significantly higher than the 0.3 rise last month. Prices for appliances, specifically, rose 1.9 percent, up from 0.8 percent. The apparel index increased 0.4 percent, snapping multiple months of declining prices. Gasoline prices rose 1 percent in June, after falling 2.6 percent the previous month. Grocery prices also rose, ticking up 0.3 percent in June.
Economists expect price pressures to intensify over the coming months, especially if new tariffs the president has threatened against the European Union and a host of other countries in recent days are imposed on Aug. 1 as planned.
