Biggest Jump in More than Year for U.S. Core Inflation

U.S. underlying consumer prices increased by the most in nearly one-and-a-half years in June amid solid gains in the costs of a range of goods and services.

However, the figure will probably not change expectations the Federal Reserve will cut interest rates this month.

Figures released Thursday by the U.S. Labor Department revealed its consumer price index, excluding the volatile food and energy components, rose 0.3% last month. That as the largest increase since January 2018 and followed four straight monthly gains of 0.1%. The so-called core CPI was boosted by strong increases in the prices for apparel, used cars and trucks, as well as household furnishings.

There were also hikes in the cost of health-care and rents. In the 12 months through June, the core CPI climbed 2.1% after advancing 2.0% in May.

The overall CPI edged up 0.1% last month, held back by cheaper gasoline and food prices.

The CPI rose 0.1% in May. It increased 1.6% year-on-year in June after rising 1.8% in May.

Economists had forecast the CPI unchanged in June and rising 1.6% year-on-year.

The Fed, which has a 2% inflation target, tracks the core personal consumption expenditures (PCE) price index for monetary policy. The core PCE price index increased 1.5% year-on-year in May and has undershot its target this year.