Inflation cooled to its lowest point since March 2021 in June.
The annual inflation rate has fallen from a high of 9 percent last year to 3 percent, according to new data released Wednesday by the U.S. Bureau of Labor Statistics.
The data was welcomed news after the Federal Reserve’s decision last month to temporarily pause its interest rate hikes to evaluate its efforts to curb inflation. The Federal Reserve kept its target rate for federal funds at 5 to 5.25 percent. It ended a streak of 10 straight hikes in interest rates since early 2022.
The Federal Reserve has held steadfast to its goal of returning inflation to 2 percent, which June’s overall inflation was just 1 percent above.
The 3 percent annual rate was down 1 percent from May’s 4 percent.
The Consumer Price Index rose 0.2 percent in June, with shelter accounting for more than 70 percent of the increase.
The core index, minus the volatile food and energy prices, showed an annual increase of 4.8 percent.
“The index for all items less food and energy rose 0.2 percent in June, the smallest 1-month increase in that index since August 2021,” the BLS report stated.
The index for used cars and trucks decreased 0.5 percent, after rising 4.4 percent in April and May. Used vehicles are down 5.2 percent in the past 12 months.
Other transportation costs continue to impact consumers. Car insurance increased another 1.7 percent in June and is up 16.9 percent in the past 12 months. Gasoline was up 1 percent in June, but is down 26.5 percent in the past year.
