📉 U.S. Inflation Puts On the Brakes, Chills Out for 12 Months Running 🎉
Inflation’s wild party seems to be winding down! 🥳 In June, U.S. annual inflation decided to take a chill pill, hitting the brakes and cooling down to a refreshing 3%. This marks a 12-month streak of relaxation, making wallets across the nation breathe a sigh of relief. But don’t pop the champagne yet, inflation still hovers above the Fed’s 2% comfort zone. As consumers, do we finally get to worry less about prices sneaking up on us like ninjas? 🥷 And for the Fed, are we there yet or are we going to need a few more pit stops (rate hikes)? 🚦
Ah, remember June last year? When prices had a full-blown meltdown, shooting inflation to a whopping 9.1%? The days when energy costs had more spikes than a porcupine? 🦔
Well, dear readers, buckle up because we’ve made quite the U-turn. A year later, we’re enjoying an inflation rate that’s down to 3%. Oh, and that’s not even the best part. This cool-down session isn’t a one-time gig. It’s been chilling for 12 straight months! Not too shabby, eh? 😉
So, what’s this cool news mean for us, the humble consumers? 🛍️ Well, we might finally see less of our hard-earned cash gobbled up by sneaky price increases that have been lurking around like unwelcome guests for the last couple of years.
But, before you start your victory dance, let’s break it down a bit more. 🕺 On a monthly basis, prices inched up by 0.2%, which is still less heated than the 0.4% increase seen in May. Gas prices revved up 1% from May but are nearly 27% less gasp-inducing than a year ago. Food prices and grocery store prices have risen 5.7% and 4.7%, respectively. As for dining out, that still burns a hole in the pocket, with a 7.7% year-on-year inflation. 🍔💰
Now, let’s switch lanes and look at this from the Fed’s perspective. 🏦 The good news is, the underlying inflation’s also taken a chill pill. The bad news? The core CPI index at 4.8% is still above the Fed’s comfort zone. So, despite the progress, we might still see the Fed reaching for that rate-hike lever when it meets later this month.
Steering back to the present, June’s inflation rate is just a touch above the 2.9% average inflation rate we had in the two decades before the financial crisis. Not too off-road, eh? 🛣️
In other news, the U.S. economy managed to rope in 209,000 jobs in June, with the unemployment rate at 3.6%. While wage increases have been an inflation scapegoat, a recent report from the Kansas City Fed found that nearly 60% of U.S. inflation in 2021 was actually because of a rise in corporate profits. Now, isn’t that food for thought? 🤔
But here’s the real twist: Despite the headline rate looking fresh and relaxed, the details reveal a different story. The devil, as they say, is in the details. 👹 The annual CPI rate benefits from base effects – when comparisons are made to the prior year. And let’s not forget, last June was a bit of an inflation monster.
So, what’s the verdict? Are we good to take our eyes off inflation, or are we just at the calm before the storm? And with the upcoming rate hike seemingly set in stone, should the Fed maybe pump the brakes a bit, or are we still far from our destination? 🤷♂️🗺️
Well, Turnt Up News-ers, over to you. What do you think? Is it time for the Fed to put their foot on the gas or should they hit the brakes? 🚗💨 Let’s get this discussion revving!