Annual inflation fell to 3% in June, the lowest since March 2021. That probably won’t stop the Federal Reserve from raising rates again, but this month’s expected hike could be the last.
Inflation has been bruising Americans for more than two years — and it’s finally losing some of its punch.
The Labor Department reported Wednesday that the consumer prices in June were up just 3% from a year ago — the smallest annual increase since March 2021. What’s more, forecasters say inflation could fall further in the months to come.
But two years of high inflation has left its scars, and people are adjusting their habits, potentially in permanent ways.
Here are five things to know about the state of inflation today.Inflation has fallen sharply from its peak last year
It was a totally different picture this time last year. Back then, inflation had topped 9%, fueled in part by record-high gasoline prices following Russia’s invasion of Ukraine.
Since then, gasoline prices have tumbled more than 26%. And that’s having a big impact on the day-to-day lives of many Americans, especially commuters like Kate Blacker from Jersey City, N.J., who travels about an hour each day to her job at a community college.
« I’m a lot less worried now than I was six months ago, eight months ago, when the prices were rising so rapidly and I didn’t know when that was going to cool down, » says Blacker.
Grocery prices also leveled off last month, in a welcome relief to consumers’ budgets.
And in another positive development in the midst of the summer, the price of airline tickets and hotel rooms fell in June, despite strong demand for travel.
