After three straight months of declines, both the CPI and the “core” CPI rebounded in June as the economy reopened.
The Bureau of Labor Statistics (BLS) reported that the Consumer Price Index (CPI) rose by 0.6% in June on a seasonally adjusted basis, after three straight monthly declines. It was the largest monthly increase in the CPI since August 2012. Excluding the volatile food and energy components, the “core” CPI rose by 0.2% in June, after a decline of 0.1% in May. It was the first monthly increase in the “core” CPI since February 2020. In June, the indexes for apparel (1.7%), shelter (0.1%), and medical care (0.4%) increased in June, while the indexes for used cars and trucks (-1.2%), recreation (-0.6%), and communication (-0.3%) all declined. The index for motor vehicle insurance increased sharply by 5.1% in June after recent declines.
Meanwhile, the price index for a broad set of energy sources rose by 5.1% in June, after five consecutive monthly declines. The gasoline index and the fuel oil index, the major components of energy commodities, increased sharply by 12.3% and 10.2% over the month. In the category of energy services, the electricity index slipped by 0.3% while the index for utility gas service was unchanged.
The food index increased by 0.6% in June, following a 0.7% increase in May. The indexes for food at home and food away from home continued to rise amid the COVID-19 pandemic.
BLS data collection in June was still affected by the COVID-19 pandemic. BLS mentioned in the today’s news release that many indexes are based on smaller amounts of collected prices than usual, and a small number of indexes that are normally published were not published this month.
Over the past twelve months, on a not seasonally adjusted basis, the CPI rose by 0.6% in June, following a 0.1% increase in May. Meanwhile, the “core” CPI increased by 1.2% over the past twelve months, the same increase as in May. The food index rose by 4.5% and the energy index declined by 12.6% over the past twelve months.