The CPI for June rose about as expected at up 0.1% month-over-month, and up 1.6% year-over-year. The increase at the core was also close to expectations at up 0.1% in June from May, and up 2.1% compared to June 2018.
Chair Jerome Powell is likely to get questions about the CPI report when he appears later before the Senate Banking Committee to deliver the second day of the semiannual monetary policy testimony at 10:00 ET. The data in the report should not alter what he has to say about inflation and inflation expectations.
It was anticipated that declines in energy costs would dominate the low reading. Energy prices were down 2.3% in June from May, and off 3.4% compared to the year-ago month. The main reason was the 3.6% drop in gasoline costs.
Food and beverage prices edged up 0.1% in June from May, and were up 1.9% compared to a year earlier.
Shelter costs — which account for about a third of the CPI — were up 0.3% in June, extending a string of steady, mild upward readings for housing. Shelter costs were up 3.5% compared to June 2018. Excluding shelter, the CPI was down 0.1% month-over-month and up 0.7% compared to a year-ago. Shelter continues to be one of the more consistent sources of price gains in the CPI.
Costs for commodities continue to exert little or no upward influence on prices. In June, commodities dipped 0.2% from the prior month, and were up a scant 0.1% from a year-ago. On the other hand, services were up 0.2% in June from May and have increased 2.6% year-over-year. Medical care and insurance are a persistent source of higher costs for consumers.
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