Increase in US Inflation Rate
In June 2025, the US inflation rate experienced an increase to 2.7%, compared to 2.4% in May. This rise is the highest since February and marks the second consecutive month of rising inflation. On a monthly basis, the Consumer Price Index (CPI) rose by 0.3%, representing the largest increase since January.
Core Inflation Remains Stable
Core inflation, which excludes the volatile categories of energy and food, was at 2.9% in June compared to the previous year, just below expectations of 3%. This indicates that prices for non-essential goods and services continue to rise.
Causes of Rising Inflation
Several factors contribute to the increase in inflation:
- Tariffs: New import tariffs are causing higher costs for consumers, particularly for products such as furniture, toys, and automobiles.
- Energy Prices: Energy prices increased by 0.9% in June after a decline of 1% in May.
- Food: Food prices rose by 3% year-on-year, with significant increases in the prices of eggs, roasted coffee, and ground beef.
Impacts on Fed Monetary Policy
The rising inflation could prompt the Federal Reserve (Fed) to reconsider its monetary policy and raise interest rates to stabilize the price level. This could have far-reaching implications, particularly for investment strategies in the German-speaking region, as changes in interest rates can directly impact the yields of bonds and other financial instruments.
Importance for Investors
For investors in the D-A-CH region, the increase in US inflation is of great significance. Higher interest rates could enhance the attractiveness of US bonds, strengthen the dollar, and also influence the euro and other currencies. Moreover, rising interest rates affect bond yields and could increase borrowing costs for businesses, which may impact the overall economic situation.