Consumer Price Index drops in June, Boosting Expectations for September Rate Cuts

The Consumer Price Index declined by ten basis points in June, marking the first monthly decrease since May 2020. The 12-month CPI rate fell to 3%, around its lowest level in over three years. A drop in gasoline prices helped pull down overall inflation for the month. Real average hourly earnings rose 0.4% in June but were up just 0.8% over the past year. The inflation data supports expectations for the Federal Reserve to start lowering interest rates in September.