Recent forecasts indicate that consumer prices in the US may rise in June 2025 due to rising gasoline prices and tariffs on imports, which could delay the Federal Reserve's plans to cut interest rates.
Forecast of Consumer Price Growth
Economists expect the Consumer Price Index (CPI) to increase by 0.3% in June, the largest monthly gain since January. This follows a 0.1% rise in May. The primary contributors include rebounding gasoline prices and costlier imported goods due to new tariffs.
Specific Effects of Tariffs
President Donald Trump's recent announcement of broader tariffs set to begin on August 1 has added further inflationary pressure to the market. These duties will affect imports from Mexico, Canada, Japan, Brazil, and the European Union. Retailers like Walmart have already warned of price hikes due to rising import costs.
Federal Reserve's Response
Despite rising inflation, the Federal Reserve is expected to keep its benchmark rate steady in the 4.25%–4.50% range when it meets later this month. Veronica Clark, an economist at Citigroup, noted that modest services inflation suggests that 'higher goods prices are not leading to broad-based inflationary pressures,' leaving the Fed room to lower rates later if necessary.
Thus, the anticipated rise in inflation in the US in June 2025 could influence the Federal Reserve's economic policy, although expectations for rate cuts remain uncertain.
