Month-over-month and year-over-year the CPI rose 0.3 percent.

CPI Year-over-Year data from the BLS, chart by Mish

The BLS CPI Report for June was a mixed basket of good, bad and indifferent details, mostly bad.

The year-over-year surge tough is mostly due to very difficult comparisons.

CPI Year-Over-Year Details

• CPI All Items: 2.7 Percent, Up 0.3 PP
• Core CPI Excluding Food and Energy: 2.9 Percent, Up 0.1 PP
• Rent of Primary Residence: 3.8 Percent, Unchanged
• Owners’ Equivalent Rent (OER): 4.2 Percent, Unchanged
• Food and Beverage: 2.9 Percent up 0.1 PP

CPI Month-Over-Month

CPI Month-over-Month data from the BLS, chart by Mish

CPI Month-Over-Month Details

• All Items: 0.29 Percent
• All Items Except Food and Energy: 0.23 Percent
• Shelter: 0.18 Percent
• Food and Beverage: 0.32 Percent
• Energy: 0.95 Percent
• Medical Care Services: 0.56 Percent
• Medical Care Commodities: 0.10 Percent

The best number in the group is shelter because it comprises 35.473 percent of the CPI. It’s tough to get good CPI numbers when shelter is rising significantly.

Today, we had a relatively bad report despite tame shelter.

Blame energy, food and beverage, and medical care services.

Looking ahead to July, the year-over-year comparison is difficult again at 0.14 percent.

For July, the year-over-year CPI will rise if the monthly CPI is over 0.14 percent. That’s a good bet from where I sit.

What’s With the Sudden Faith of Republicans in BLS Inflation Reports?

Yesterday, I asked What’s With the Sudden Faith of Republicans in BLS Inflation Reports?

Suddenly, MAGA supporters think inflation is low and guaranteed to stay that way.

Because some people don't believe inflation is 1% annualized 🤗 pic.twitter.com/9m16dTJ4ri

— Peter St Onge, Ph.D. (@profstonge) July 1, 2025

Given the sudden faith in BLS numbers as well as annualizing a single month as if if means something, I present the following chart.

CPI Compounded Annual Rate of Change

Annualized inflation is now running 3.5 percent. Mercy! Should the Fed hike?

CPI Indexes

I seem to remember a time when no Libertarian would look at the above chart and claim inflation is nonexistent.

Peter St Onge did say “tariff inflation”. But due to massive front-running of tariffs, everyone should have expected a delay.

It’s not even clear the bulk of tariff increases have hit yet.

Is the Next Fed Move a Cut?

I am not convinced the answer is yes, but currently I think so. Regardless, there is a wide range of outcomes including stagflation and an economic collapse.

If jobs stay firm and tariffs ignite inflation, the Fed might be temped to hike.

It’s important to understand no one knows what Trump will do with tariffs or how the market will react. That is how I see things and that is how the Fed sees it also.

Repeating past statements. There should not be a Fed. But the one thing worse than an independent Fed is one controlled by the president.

I Officially Announce my Availability to Become the Next Fed Chair

On July 9, I posted I Officially Announce my Availability to Become the Next Fed Chair

Trump considers naming the next Fed Chair early. I have a fifteen-point plan.

I throw my name into the ring.

And I have a plan for what needs to be done. Does anyone else have a plan?

Mish’s 15-Point Fed Plan

1. Explain to the nation why we don’t need a Fed and how independent central banks have created boom-bust cycles of increasing amplitude over time. The main corollary is history shows the one thing worse than independent central banks is a central bank run by politicians, frequently ending in hyperinflation.
2. Surround myself with qualified insiders who understand the Fed but also believe in the mission to end the Fed.
3. Stop paying interest on reserves, phased in over 18 months.
4. Wind down the Fed’s balance sheet totally in 2-3 years.
5. Require that assets available on demand such as checking and savings accounts are truly available on demand. That means demand deposits are parked in overnight US treasuries. This would be phased in over two years. As a result, we would have genuine safekeeping banks.

That’s the first five. Click on the above link for further discussion.

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