June: Inflation Sees Biggest Drop Since 2020 Due to Lower Energy Prices
The June 2026 consumer price index (CPI) shows that inflation decreased by 0.4% after increasing by 0.5% in May, due to lower energy prices.
As you all know, I just like to give you guys the numbers. You don’t need an analysis. The numbers speak for themselves.
The energy index helped the monthly all items decrease, offsetting an increase in other indexes:
- Energy: +3.9% in May, -5.7% in June
- Energy commodities: +6.7% in May, -9.5% in June
- Gasoline (all types): +7% in May, -9.7% in June
- Fuel oil: +3.8% in May, -9.2% in June
- Energy services: +0.4% in May, -0.7% in June
- Electricity: +0.6% in May, -0.7% in June
- Utility (piped) gas service: -0.5% in May, +0.5% in June
Here is food:
- Food: +0.2% in May, +0.2% in June
- Food at home: +0.1% in May, +0.2% in June
- Food away from home: +0.3% in May, 0.2% in June
The all-items index increased 3.5% over the last 12 months after rising 4.2% in May:
- Core CPI rose 2.6% over the year, following a 2.9% increase in May.
- The energy index increased 15.7% for the 12 months ending June.
- The food index increased 3.0% over the last year.
- The shelter index increased 3.3% over the last year.
- Other indexes with notable increases over the last year include airline fares (+26.5%, medical care (+2.0%), recreation (+2.8%), and household furnishings and operations (+2.5%).
Breakdown:
- Cereals and cereal products: +2.4% in 12 months, 0.7% in a month
- Flour: -1.3% in 12 months, -1.1% in a month
- Bread: +3.9% in 12 months, +0.5% in a month
- Meats, poultry, fish, and eggs: +5.6% in 12 months, -0.1% in a month
- Meats (all): +2.6% in 12 months, +0.6% in a month
- Ground beef: +12.4% in 12 months, +1.3% in a month
- Fresh & frozen chicken parts: -2.2% in 12 months, -1.1% in a month
- Eggs: -27.9% in 12 months, +4.3% in a month
- Milk: +6.6% in 12 months, +2.0% in a month
- Fruits & veggies: +5.3% in 12 months, -0.2% in a month
- Apples: +7.1% in 12 months, +1.8% in a month
- Bananas: +1.0% in 12 months, -1.3% in a month
- Pop: +1.9% in 12 months, -0.7% in a month
- Coffee: +12.9% in 12 months, -2.0% in a month
- Sugar: +6.9% in 12 months, +0.6% in a month
- Butter: -6.9% in 12 months, -0.2% in a month
July’s report might look different, though, due to the conflict in the Middle East. How many times have we gone to war with Iran since March? We win, it’s over, but then we restart it.
The numbers might convince the Federal Reserve not to raise rates.
But the Fed relies more on inflation figures from the Commerce Department, which come out at the end of July. The Commerce rate hit 4.1% in May, which is above the Fed’s 2% target.
The Fed also meets at the end of the month, near when we get the Commerce Department’s inflation numbers.
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