Inflation Rolls Merrily Along: 9.1% In June – NMP Skip to main content

Inflation Rolls Merrily Along: 9.1% In June

Jul 13, 2022
inflation

Latest Consumer Price Index report sets up Federal Reserve for another 75-basis-point rate hike.

Even with the Federal Reserve trying to slam on the brakes, inflation rolled merrily along in June.

According to the latest report from the U.S. Bureau of Labor Statistics, released today, the Consumer Price Index rose 1.3% in June on a seasonally adjusted basis after rising 1% in May. But over the past 12 months, the index rose 9.1% before seasonal adjustment, the largest annual increase since the period ending November 1981.

The increase also blew past the expectations of analysts, who told Dow Jones they expected an 8.8% spike. It also topped May’s 8.6% annual increase in the CPI.

The increase in the Consumer Price Index for All Urban Consumers (CPI-U) in June was broad-based, with the indexes for gasoline, shelter, and food being the largest contributors. 

The energy index rose 7.5% over the month and contributed nearly half of the all-items increase, with the gasoline index rising 11.2% and the other major component indexes also rising. 

The food index rose 1% in June, as did the food-at-home index. 

The index for all items minus food and energy, which are considered highly volatile, rose 0.7% in June after increasing 0.6% percent in the preceding two months. 

While almost all major component indexes increased over the month, the largest contributors were the indexes for shelter, used cars and trucks, medical care, motor vehicle insurance, and new vehicles. The indexes for motor vehicle repair, apparel, household furnishings and operations, and recreation also increased in June.

Shelter increased 5.6% year over year, the fastest pace since 1991. Shelter accounts for about 40% of the core CPI, which excludes food & energy.

Mark Fleming, chief economist for First American Financial Corp. says the shelter data is actually an obstacle to reining in inflation.

"“One headwind for the Fed’s fight against inflation (is), shelter inflation is delayed up to six to 12 months," he said. "Rapid growth in rent expense over the last year is only now beginning to hit the headline CPI figure, which means there’s more upward pressure to come.”

Among the few major component indexes to decline in June were lodging away from home and airline fares. Airline fares fell 1.8% in June after rising sharply in recent months. The communication index was unchanged over the month.

 

Year over year, the all items less food and energy index rose 5.9%. The energy index rose 41.6% over the last year, the largest 12-month increase since the period ending April 1980, the BLS said. 

The food index increased 10.4% for the 12-months ending June, the largest 12-month increase since the period ending February 1981.

Even before today’s CPI report was released, the White House was already in spin mode.  According to Yahoo Finance, the Biden administration spent Tuesday downplaying expectations for the report. 

“June CPI data is already out of date,” White House Press Secretary Karine Jean-Pierre said during Monday’s press briefing, Yahoo Finance reported.

There is some truth to that; the national average price of gasoline, for example, has fallen for 28 straight days, according to AAA.

Nonetheless, the CPI report is likely to embolden the Fed, which will convene a two-day meeting of its Federal Open Market Committee later this month and is expected to boost the benchmark Federal Funds Rate by another 75 basis points. The FOMC raised the rate by that much last month, the largest single increase since November 1994.

"The accelerating inflation means there’s a lot more work for the Federal Reserve to do," Fleming said. "Another 75-point increase in the federal funds rate is almost assured."

About the author
David Krechevsky was an editor at NMP.
Published
Jul 13, 2022
More Buyers Expect Higher Rates. Fewer Would Wait.

Veterans United’s survey finds less willingness to hold out for lower rates, but little change in purchase timelines

Oct 22, 2026
Mortgage Rate Lock-In: More High-Rate Loans, Few Signs Of A Thaw

With 30-year rates above 7% and nearly half of outstanding loans below 4%, originators face a stubborn obstacle to rebuilding repeat-buyer pipelines

Oct 22, 2026
Investor Homebuying Slows, Small Buyers Claim Biggest Share In 15 Years

Smaller investors accounted for 66.2% of investor purchases in the first half of 2026 and relied on cash much less often than mega-investors

Oct 22, 2026
California Home Sales Drop 6.5%, Prices Keep Climbing

September’s decline leaves originators competing for fewer purchases, while rising borrowing costs and limited new listings keep affordability under pressure

Oct 20, 2026
One In Three Americans Blame Lenders For Housing Crisis Ahead Of Midterms

Voters want lower taxes, insurance costs, and mortgage rates, but 63% doubt the election will improve housing

Oct 20, 2026
Rates Above 7% Shrink Buyer Budgets In Loosening Housing Market

Realtor.com finds 66 of 99 metros favor buyers or are moving that way, while rising financing costs have cut borrowing capacity 7.2% since late August for a fixed monthly payment

Oct 19, 2026