U.S. consumers felt a noticeable pinch in June as inflation climbed to 2.7% annually, up from 2.4% in May. With global trade tensions escalating and new tariffs on imports taking effect, everyday essentials like food, healthcare, and shelter are becoming more expensive—leaving many Americans bracing for what’s next.
The latest Consumer Price Index (CPI) report, released Tuesday, signals that inflationary pressures remain persistent despite previous signs of cooling. While prices for airfare and automobiles—both new and used—eased slightly, other critical categories saw continued increases.
One key concern behind June’s uptick: the return of global trade tariffs. Analysts point to rising prices in categories that are closely tied to international trade, such as furniture, appliances, and clothing. Household furnishings, for example, jumped 1% in June—the sharpest increase since early 2022—suggesting that tariffs are starting to filter through to consumer prices.
Recreation and apparel costs also edged higher, adding to speculation that the economic fallout from tariffs may only be getting started.
Food inflation continues to strain household budgets. Grocery prices rose another 0.3% in June, matching May’s increase and marking a 2.4% year-over-year rise. Meat prices, particularly beef, have remained stubbornly high. Ground beef now averages $6.10 per pound—nearly 10% more than this time last year. Steak prices soared even higher, with a 12.4% annual jump.
While egg prices have finally begun to fall—dropping 7.4% from May—their average price of $3.78 per dozen remains significantly higher than the $2.72 average just a year ago. Eating out also became more expensive, with restaurant prices climbing 0.4% in June and up 3.8% year-over-year.
Healthcare costs continue to rise at a steady pace. Medical services were up 0.6% from May and 3.4% from a year ago. Hospital services and nursing home care saw even larger increases, at 4.2% and 5.1% respectively. Health insurance premiums also edged higher, up 3.4% from last year.
Shelter costs—typically the largest portion of household expenses—rose another 0.2% last month and are now 3.8% higher than June 2024. However, increased apartment construction and cooling home prices may offer a slight reprieve in coming months.
There was at least one bright spot for consumers: gasoline. Prices at the pump rose 1% in June but remain 8.3% lower than a year ago. AAA reports a national average of $3.15 per gallon, down from $3.52 last summer.
Used car prices dipped 0.7% monthly, and new vehicle prices fell 0.3%—further signaling stabilization after pandemic-era surges.
With inflation still above the Federal Reserve’s 2% target, economists expect the central bank to keep interest rates unchanged at its July meeting. The hotter-than-expected June data may also delay hopes for a rate cut in September.
For now, households are being forced to navigate a landscape where necessities cost more and relief remains limited—especially if tariffs continue to ripple through the economy.
