US consumer inflation cooled more than expected in June, government data showed Tuesday, as energy costs fell on a temporary easing of the US-Iran war.
However, with oil prices again rising on the renewal of Middle East hostilities, and US President Donald Trump ordering the restart of a blockade of Iranian ports, the progress could be fleeting.
The consumer price index rose 3.5 per cent on a year-on-year basis in June, down from a 4.2 per cent increase in May, according to Labour Department data.
The figure marked a pullback from a three-year high, as a drop in energy costs more than offset upticks in housing and food prices.
According to the AFP report on Tuesday, analysts had anticipated a larger 3.8 per cent CPI, according to economists surveyed by Dow Jones Newswires and The Wall Street Journal.
Steeper costs have squeezed household budgets, piling pressure on the Trump administration ahead of midterm elections this year.
All eyes are now on Federal Reserve Chairman Kevin Warsh, who vowed Tuesday that the independent central bank will rid the United States of a years-long “inflation surge.”
He stressed to the House Financial Services Committee in a hearing that policymakers have “no tolerance” for stubbornly high prices.
US lawmakers questioned Warsh over progress on lowering inflation, among other issues, as markets watch for hints that the Fed may lift interest rates later this year — despite Trump’s insistent pressure for cuts.
