Yesterday the Bureau of Labor Statistics released the inflation numbers for the month of June.
Overall inflation over the last 12 months decreased from 4.3% to 3.5%, which was lower than economists expected. Monthly inflation declined .4% which was the largest monthly decrease since 2020. Most of the decrease was due to falling gas prices.
Core inflation, which excludes food and energy and is the metric the Fed takes into greater consideration, lowered from 2.9% to 2.6% for the last 12 months.
Lower inflation, if it continues, would lower the risk that the Fed raises interest rates to combat inflation which would likely be negative for the economy as well as the investment markets. However, with the Iran conflict heating up again resulting in rising gas prices, it is hard to predict inflation going forward and how the Fed will eventually act.
Thank you very much for taking time today to keep informed by reading this post.
