June inflation data shows a continued rise in the overall consumer price index, but does not reflect the recent decline in food and energy prices.

Below, EPI Director of Research Josh Bivens offers his take on today’s June Consumer Price Index (CPI) release. Read the full Twitter thread here.

This time, there is even less reason to overreact to high inflation rates. We all know that the main drivers of today’s high numbers are commodity prices (mainly energy and food), and we also know that many of these prices have plummeted in recent weeks. 2

— Josh Bivens (@joshbivens_DC) July 13, 2022

It was a great job report. And everyone knew that the vision of the US economy it promoted was completely out of date — by the time the report was released, the effects of COVID-19 were already hitting the economy. fourhttps://t.co/kvziXGGIeB

— Josh Bivens (@joshbivens_DC) July 13, 2022

But it highlights that economic conditions are changing rapidly, and many of the data conventions that guide economic commentary and analysis are ill-equipped to acknowledge this. 6 pic.twitter.com/804K8VZjnh

— Josh Bivens (@joshbivens_DC) July 13, 2022

A similar story applies to what was once considered the Fed’s most important indicator of inflation—the core price index for personal consumption spending. It has also shown a slowdown in recent months. eighthttps://t.co/w4ov8AcwwU

— Josh Bivens (@joshbivens_DC) July 13, 2022

They have time to wait and see if the recent signs of a slowdown work. The risk of damaging a strong and welcome recovery from the pandemic downturn is very high, and many of the drivers of inflation may already be slowing down. ten

— Josh Bivens (@joshbivens_DC) July 13, 2022