The Bureau of Labor Statistics’ June report revealed that the inflation crisis continued to worsen last month as prices rose 9.1% from the year before, the highest rate since November 1981 – a record that has been broken repeatedly over the last year as the Biden administration has been unable to control inflation.
The number was even worse than economists expected, according to CNBC. “The consumer price index, a broad measure of everyday goods and services related to the cost of living, soared 9.1% from a year ago, above the 8.8% Dow Jones estimate,” CNBC reported. “Excluding volatile food and energy prices, so-called core CPI increased 5.9%, compared with the 5.7% estimate… On a monthly basis, headline CPI rose 1.3% and core CPI was up 0.7%, compared to respective estimates of 1.1% and 0.5%.”
The outlet noted that the numbers conflict with the Biden administration’s narrative that inflation may be peaking.
“CPI delivered another shock, and as painful as June’s higher number is, equally as bad is the broadening sources of inflation,” said Robert Frick, corporate economist at Navy Federal Credit Union. “Though CPI’s spike is led by energy and food prices, which are largely global problems, prices continue to mount for domestic goods and services, from shelter to autos to apparel.”
Increasing inflation could push the Federal Reserve to further increase interest rates, increasing the likelihood of an upcoming recession.
“U.S. inflation is above 9%, but it is the breadth of the price pressures that is really concerning for the Federal Reserve.” said James Knightley, ING’s chief international economist. “With supply conditions showing little sign of improvement the onus is the on the Fed to hit the brakes via higher rates to allow demand to better match supply conditions. The recession threat is rising.”