In the recent report of the Bureau of Labor Statistics, the US inflation for June 2011 declined by 0.2% or in annual terms it rose by 3.6%.
The prime reason for the decrease was related to the drop in energy index that fell by 4.4% (M-2-M) during June compared with May’s. In annual terms, however the energy index increased by 20.1%. Among the energy products, the gasoline led the fall with a 6.8% drop during June. This effect is primarily exogenous to the US economy as the oil and gasoline prices are mainly determined by global events such as the Libyan war and less by domestic effects (changes in supply and demand).
The report also showed, a moderate incline in food index as it rose by 0.2% during June and in annual terms food index increased by 3.7%.
In the previous month the May 2011 CPI inclined by 0.2 percent points.
This shift in direction might indicate that the inflation pressures aren’t high, despite the Federal Reserve’s Monetary policy including its stimulus plan by and the near zero interest rates. This report won’t hold back the Fed from forming a new stimulus plan, because the US inflation report shows there are currently no apparent adverse ramifications to its Monetary policy.
Current Nymex crude oil price, short term futures (August 2011 delivery) is traded up by 2% to $97.60 per barrel as of 17:01*.
Current gold price, short term futures (August 2011 delivery) is traded at $1,589.4 per t oz. a $0.1 increase or 0.01%, as of 17:00*.
Euros to US Dollar is currently traded up at 1.4154 a 0.0781% increase as of 17:11*.
The USD to Canadian dollar exchange rate is traded down at 0.9532 a 0.7709% decrease as of 17:11*.
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