US inflation jumps as Trump tariffs 'bite'

What happened

Consumer prices rose 0.3% in June, according to Labor Department data released Tuesday, pushing the annual inflation rate to 2.7%. That's the highest rate since February.

Imported items saw some of the steepest price hikes. The cost of appliances, for example, jumped 1.9%, the biggest monthly rise since the Covid-19 pandemic in 2020.

Who said what

While the inflation numbers aren't "as bad as expected," they suggest that President Donald Trump's import tariffs are "starting to bite," Heather Long, the chief economist at Navy Federal Credit Union, told CNN. "A long stretch when Trump's policies left little imprint on the hard data appears to be ending," said The Wall Street Journal.

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Shortly after the report was released, Trump posted on Truth Social that the Federal Reserve should cut interest rates "NOW!!!" But the new data will likely undermine Trump's "massive pressure campaign" on Fed Chair Jerome Powell, said Politico. The report deals a "knock-out punch to the tariff inflation deniers," Samuel Tombs of Pantheon Macroeconomics said in a note to clients.

What next?

Price pressures could "intensify over the coming months," said The New York Times, especially if Trump's threatened tariffs on the European Union and other countries come into effect on August 1. A decision about whether to cut interest rates will come after the next Fed meeting at the end of July.