The Consumer Price Index (CPI) data for June in the US have been made public by the Bureau of Labour Statistics (BLS). The data also reveals that the nation’s inflation rate has dropped to 3%. It is interesting that this indicates a favorable trend because it shows a consistent decline from the rate of 4% in the previous month and 4.9% in April.
How will the Fed respond to the US inflation data from June?
The benchmark federal funds rate has been gradually increased by the Fed over a 10-adjustment period starting in March 2022, bringing it to a target range of 5 to 5.25 percent.
Uncertainty surrounds the Fed’s response to the present inflation rates. It will be interesting to see if they decide to raise interest rates or take action to control the issue.
The CEO of BOA, Brian Moynihan, reportedly told CNN in an interview that he thinks the country may hit its 2% inflation goal by 2025. Additionally, according to the Fed’s most recent predictions, inflation might drop from its current rate of 4.4% to as low as 2.1% in 2025.