The Consumer Price Index (CPI), a key measure of inflation in the U.S., surged by 0.9% in June after adjusting for seasonal factors, according to the U.S. Bureau of Labor Statistics (BLS). The jump marked the highest rate of increase since it went up 1% in June 2008, and it marks a third consecutive month of increases.
The index’s annual rise of 5.4% was also significant, marking the fastest pace of increase since August 2008, when prices also surged the same amount. Comparatively, consumer prices rose 0.6% in the prior month in May.
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June’s increase was led by rising auto prices, which surged 10.5% for the month. Prices on used cars and trucks accounted for about one-third of the overall index increase. But this comes as no surprise, as auto spending, auto credit and auto prices have been consistently increasing in recent months. Other sub-indices like the energy index increased 1.5% in June, and the gasoline index rose 2.5% over the month.
One way to offset higher prices is by lowering other monthly payments. For example, those buying a car or truck could lower their auto insurance payments to make up for the increased price of the vehicle. Visit Credible to see multiple auto insurance offers at once and find the one that best fits your needs.
But even as prices surge, the average change in real earnings decreased for all workers, according to the latest Real Earnings Summary report from BLS. Real hourly wages dropped 0.5% from May to June and on an annual basis, real average hourly earnings decreased 1.7% across all occupations.
If you're struggling to keep up as prices continue to surge, consider taking a cash-out refinance on your home in order to make repairs or pay off high-interest debt. Prices on housing units are currently rising at a pace of 18% annually, the highest increase on record and creating record equity gain for homeowners, according to the latest Mortgage Monitor report from Black Knight. Visit Credible to check out your mortgage refinance options and get prequalified without affecting your credit score.
Many economists believe that the period of inflation will worsen before it gets better during the U.S. economic rebound. Federal Reserve officials continue to maintain low interest rates for now, predicting that the inflation pickup is temporary and will soon settle down. But others are not so sure.
If the economy continues to heat up at its current pace, an interest rate hike may be warranted sooner than later. If you're looking for ways to catch up on your monthly payments as prices rise, consider taking out a personal loan now while interest rates remain low. Visit Credible to compare multiple options at once and talk to a lending expert to get your questions answered.
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