Inflation has biggest drop since 2020
Axios · LC · trust 59/100
Add Axios on Google Data: Bureau of Labor Statistics ; Chart: Emily Peck/Axios Inflation fell in June, on the back of lower energy prices, the government said Tuesday.
Why it matters: It's the largest one-month decrease since April 2020, but it may be a short-lived reprieve — the report doesn't account for the sharp increase in oil prices this month as the Iran war re-ignites.
By the numbers: Still, inflation is pretty hot . The Consumer Price Index rose 3.5% in the 12 months through June — down from 4.2% in May.
Zoom in: The CPI for energy fell 5.7% in June, after climbing 3.9% in May — it was the largest factor in the June fall in inflation.
The big picture: The data doesn't account for the sharp rise in oil prices this week, as the U.S. and Iran resumed a hot war.
Between the lines: That means Americans are likely about to experience another bout of pain at the gas pump — a political problem for President Trump and Republicans as the midterm elections draw near.
What to watch: Even as the inflation picture looks a little less severe than last month, it's not at all clear that we're on track to come close to the Federal Reserve's 2% target anytime soon.
Zoom in: Tariff price increases are still being passed through to consumers — and the AI boom is raising costs.
Yes, but: The decline in inflation in June could keep the Federal Reserve from raising rates further this year, analysts say.
What to watch: Expect all of this to come up later this morning when the new Federal Reserve chairman, Kevin Warsh, testifies before the House Financial Services Committee, and again tomorrow, when he appears before the Senate Banking Committee.
Editor's note: This story has been updated with additional details.
sms (opens in new window) facebook (opens in new window) twitter (opens in new window) linkedin (opens in new window) bluesky (opens in new window) Add Axios on Google What to read next Smarter, faster on what matters. Explore Axios Newsletters About Axios Advertise with us Careers Contact us Newsletters Axios Live Axios HQ Privacy policy Terms of use Axios Homepage Axios Media Inc., 2026
Read the original at Axios →
Open in TruthVane →