Consumer Prices Drop More Than Expected In June

The U.S. consumer prices declined more than expected in June as lower energy costs helped ease inflation, according to the Bureau of Labor Statistics.

Core inflation, which excludes food and energy, remained unchanged in June, leaving the yearly rate at 2.6%, the report said.

Energy prices dropped 5.7% during the month, led by declines of more than 9% in gasoline and fuel oil. Shelter, transportation and apparel costs also moderated, while food prices rose modestly.

The softer inflation data boosted market sentiment and lowered Treasury yields. However, according to the report, investors still expect the Federal Reserve to raise interest rates in September, though with reduced probability.

Economists cautioned that renewed U.S.-Iran tensions and higher oil prices could reverse recent inflation gains in the coming months.

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Breaking news: US inflation fell sharply to 3.5% in June as lower oil prices helped tame a surge in costs for Americans https://t.co/ENNzFJUpnd pic.twitter.com/YUomo2osR6

— Financial Times (@FT) July 14, 2026

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tippinsightsTIPP Staff