US inflation accelerates to 9.1%, once again exceeding forecasts

The Federal Reserve is on track for another big interest-rate hike later this month, as US inflation accelerated in June by more than forecast.

The Labor Department said the consumer price index rose 9.1% from a year earlier. The most recent increase in the widely followed inflation gauge was 1.3%, reflecting higher gasoline, shelter and food costs.

The economists projected a rise of 1.1% from May and an increase of 8.8% from a year ago.

The so-called coreCPI, which excludes food and energy, advanced 0.7% from the previous month and 5.9% from a year ago, above forecasts.

The US stock futures fell after the report.

The inflation figures show that price pressures are pervasive throughout the economy and continue to affect purchasing power and confidence. That will keep Fed officials on an aggressive policy course to rein in demand and will add pressure on President Joe Biden and congressional Democrats.

Many economists think that this data will be the peak of the current inflationary cycle, but other factors such as housing will keep price pressures elevated. Supply chains and the inflation outlook are at risk due togeopolitical risks.

Fed policy makers have already signaled a second 75 basis-point hike in interest rates later this month, as well as still-robust job and wage growth. The price of a three-quarter percentage-point hike for July was already fully priced before the data was released.

The prices for household necessities continued to go up. The price of gas rose in June. Electricity and natural gas prices increased the most in seven years. The increase in food costs was the largest in 33 years.

Some companies are still able to pass on recent commodity price increases. In the second quarter, the company was able to charge customers more. The company said volumes have held up.

The rent of primary residence increased in June. Shelter costs, which are the biggest services component and make up a third of the overallCPI index, rose 0.6% in the month of February.

While home sales have slowed due to higher mortgage rates, economists expect rental inflation to continue to increase because it takes time for price changes to feed into the consumer price index.