United States: Inflation comes in at highest level since 1981 in June
Consumer prices rose 1.32% in June over the previous month, picking up from May’s 0.97% increase. June’s result was the highest reading since September 2005. Looking at the details of the release, the reading was largely driven by accelerations in energy and transport prices.
Inflation rose to 9.1% in June, following May’s 8.6%. June’s result was the highest inflation rate since November 1981. Annual average inflation rose to 7.2% in June (May: 6.9%). Finally, core inflation edged down to 5.9% in June, from the previous month’s 6.0%.
The June inflation reading—which was well above market expectations—will put pressure on the Fed to hike aggressively at its 26–27 July meeting. A hike of 75–100 basis points now appears likely.