Washington, D.C.:
US consumer inflation rose 2.7% in June year-on-year, up from 2.4% in May, largely driven by higher energy prices and the ripple effects of President Donald Trump’s tariff regime, according to data released by the Department of Labor on Tuesday.
On a monthly basis, the Consumer Price Index (CPI) climbed 0.3%, up from the 0.1% gain in May. The core CPI — which excludes volatile food and energy prices — rose 0.2% month-on-month, bringing the annual core inflation rate to 2.9%.
Energy, Furnishings, Apparel See Steepest Gains
While energy costs led the rise in overall inflation, analysts also flagged household furnishings and apparel as segments showing early signs of price pressures. These are among the categories most vulnerable to the 10% blanket tariffs Trump introduced in April, along with steeper duties on steel, aluminum, and autos.
Economists Warn of Tariff-Driven Inflation
Though the Trump administration continues to downplay concerns, some economists say the effects of tariffs are beginning to materialize in consumer prices.
“Businesses are trying to shield consumers by absorbing the cost increases or negotiating with suppliers,” said Oren Klachkin, an economist at Nationwide, “but that buffer may not hold for much longer.”
Klachkin noted that “core” inflation components most exposed to tariffs — such as recreational goods, electronics, and clothing — will be key indicators in the coming months.
Administration Dismisses Concerns
US Treasury Secretary Scott Bessent dismissed economic warnings, labeling inflation fears as “tariff derangement syndrome.” Despite repeated criticisms from economists and business leaders, the Trump administration has doubled down on tariffs and threatened further duties against countries like the EU, India, Japan, and South Korea, unless they strike favorable trade deals.
Additionally, plans are reportedly underway to impose sector-specific tariffs on semiconductors, pharmaceuticals, and other critical imports, further raising fears of supply chain disruptions and global economic uncertainty.
Looking Ahead
While headline inflation remains within manageable levels, experts warn that the full impact of tariffs may not be visible yet. Klachkin said the summer months could see larger price increases as companies pass rising costs onto consumers.