U.S. Inflation Eases as Consumer Prices Post Biggest Monthly Drop in Over Six Years

The U.S. Consumer Price Index (CPI) recorded its largest month-to-month decline in more than six years between May and June, driven primarily by falling gasoline prices, according to the U.S. Bureau of Labor Statistics (BLS), Danielle Chemtob reported for Forbes Daily.

This is the largest monthly decline in U.S. consumer prices in more than six years.

The encouraging inflation data boosted investor confidence and significantly reduced expectations that the Federal Reserve would raise interest rates at its July policy meeting.

However, economists cautioned that the improvement may be temporary, as the collapse of U.S.-Iran peace negotiations has already pushed oil prices higher, potentially adding upward pressure to future inflation.

"A positive resolution with Iran before the end of the summer is becoming increasingly important," Jeffrey Roach, Chief Economist at LPL Financial, said in comments shared with Forbes Daily.