U.S. consumer prices rose in June as the cost of gasoline surged, but the underlying trend remained consistent with a gradual build-up of inflationary pressures.
The Labor Department said on Tuesday its Consumer Price Index increased 0.3 percent last month, with gasoline accounting for two-thirds of the gain, after May’s 0.4 percent rise.
In the 12 months through June, the CPI increased 2.1 percent after a similar rise in May.
Inflation is creeping up as the economy’s recovery becomes more durable, a welcome development for some Federal Reserve officials who had worried that price pressures were too low.
The steady increases have led some economists to predict that a separate inflation gauge watched by the Fed, currently running below the U.S. central bank’s 2 percent target, could breach that target by year-end as an acceleration in job growth lifts wages.
Fed Chair Janet warned last week the Fed could raise interest rates sooner and more rapidly than currently envisioned if the labor market continued to improve faster than anticipated by policymakers.
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