US inflation reaches 9.1% in June, highest in 41 yrs

The inflation in US has come at 9.1 per cent in the month of June, this is the highest inflation in the country since 1981, the Labor Department data showed Wednesday, rising from its 8.6 per cent level recorded in the month of May. The markets were expecting US Consumer Price Index (CPI) inflation to scale a fresh multi-year high of 8.8 per cent in June, 2022.  

“This could once again elicit aggressive monetary policy response from the Federal Reserve, raising the likelihood of another 75 bps rate hike in their upcoming policy review later this month,” said Vivek Kumar, economist at QuanEco said.  

Fed policy makers have already signaled a second 75 basis-point hike in interest rates later this month amid persistent inflation. The consistently high inflation had pushed Fed officials, to engage in fastest series of rate hikes since the late 1980s, in a bid to tame inflation. The US Federal Reserve in June raised interest rates by 75 basis points or 0.75 percentage points, the biggest hike in 28 years, to stem a surge in inflation. Fed Chair Jeremy Powell, at a news conference last month, said and made it clear that the central bank wants to see “compelling evidence” that inflation is slowing before it would dial back its rate hikes.