U.S. consumer prices likely accelerated again last month to the hottest print of the current inflation cycle.
The Bureau of Labor Statistics' June Consumer Price Index (CPI) is expected to reflect a year-over-year increase of 8.8%, according to estimates from Bloomberg.
If realized, June data will show prices climbed at a faster pace than the prior 40-year high of 8.6% in May.
The continued surge in inflation across the U.S. economy is likely to be elevated by high food costs and record gasoline prices, which topped more than $5 per gallon at the pump last month.
Since this recent peak, however, commodity prices have been under pressure with crude oil falling more than 8% to below $96 a barrel on Tuesday.
“Core” CPI, which excludes the volatile food and energy components of the report, is projected to rise 5.7%, according to consensus estimates compiled by Bloomberg. This would mark a slowdown from the 6% jump seen in May.
"The data-driven Federal Reserve will be picking apart June’s CPI release to see if last month’s broad-based inflation increases are repeated," MSCI Head of Portfolio Management Research Andy Sparks said in an emailed note Tuesday. "The Fed’s nightmare is that inflation accelerates and is not limited to energy, but carries over into the other components of the consumer’s basket."
June's figures will be pivotal in guiding central bank officials on their next policy move as they tighten monetary policy in efforts to restore price stability.
The U.S. central bank is expected to raise interest rates by another 75 basis points at the next policy-setting meeting on July 26-27.
Meanwhile in Washington, the White House on Tuesday warned in a call with reporters that June’s inflation numbers were likely to be “highly elevated” but downplayed the weight of last month’s figure, pointing to gas prices that have retreated from their highs.
“June CPI data is already out of date,” White House Press Secretary Karine Jean-Pierre said in Monday’s press briefing.
