U.S. CPI Drops 0.4% in June, Defying All 67 Economist Forecasts

The U.S. Consumer Price Index fell 0.4% in June on a seasonally adjusted basis, the largest monthly decline since April 2020. The all‑items index was 3.5% higher than a year earlier, down sharply from 4.2% in May. Energy prices drove most of the drop, falling 5.7%, with gasoline plunging 9.7% for the month. The core CPI, which excludes food and energy, was unchanged at a 2.6% year‑over‑year rise. Shelter costs rose only 0.1%, the smallest monthly increase since January 2021, while food prices rose 0.2%.

A Bloomberg survey of 67 economists had all predicted a rise, missing the negative reading entirely. National Economic Council Director Kevin Hassett said the result was four times more negative than expected. The White House highlighted the surprise, noting the headline inflation decline and the cooling of core inflation as evidence that the Trump administration’s policies were mitigating price pressures.