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14 July 2017
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| Consumer Prices (The Total Investment & Insurance Solutions) |
Lower costs for gas, airline tickets, new and used cars and wireless
mobile phone plans kept U.S. consumer prices flat in June, evidence that
inflation remains muted.
The unchanged reading followed a drop of 0.1
percent in May, the Labor Department said Friday. Inflation has climbed just
1.6 percent from a year ago. That's down sharply from February, when prices
rose 2.7 percent from a year earlier. The
Total Investment & Insurance Solutions
Excluding the volatile food and energy
categories, prices rose 0.1 percent in June and 1.7 percent from a year
earlier. The Total Investment &
Insurance Solutions
As inflation has slowed, the Federal
Reserve's plans to raise interest rates once more this year and three times
next year have come under greater scrutiny. The Fed typically hikes rates to
ward off rising inflation, yet price gains have declined this year. The Total Investment & Insurance
Solutions
Fed policymakers have lifted their benchmark
short-term rate four times in the past 18 months.
Federal Reserve Chair Janet Yellen hinted on
Wednesday that the Fed could slow its rate hike plans if inflation continues to
run below the Fed's 2 percent target. That caused a rally in the stock markets
as investors celebrated the prospect of lower interest rates for longer.
Yet on Thursday, in a second day of testimony
before Congress, Yellen sought to clarify those views and said it would be
"premature" to conclude that inflation will remain weak. Fed
officials have previously cited big drops in the cost of wireless
communications plans as a temporary factor holding down prices.
On Thursday, Yellen said the low unemployment
rate would likely force employers to raise pay to attract and keep workers,
which in turn should push up prices. The
Total Investment & Insurance Solutions
The measure of wireless phone costs fell 0.8
percent in June and is down 13.2 percent in the past year. That mostly reflects
new unlimited data plans. The government records additional goods or services
for the same price as the equivalent of a drop in price. The Total Investment & Insurance Solutions
Gas prices fell 2.8 percent in June, after a
6.4 percent fall in May. Electricity costs slid 0.6 percent.The Total Investment & Insurance
Solutions
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