The Labor Department announced today that the consumer price index, or CPI, showed a moderate increase in June, rising 0.2 percent. Although this was the smallest gain in four months, the Fed will be giving a long look at core inflation, up 0.3 percent and showing an increase for the fourth consecutive month, to determine whether more rate increases are needed or not.

"Today's CPI report showed the cost of goods continues to rise. This will embolden the Fed's assertion that inflation remains a problem and heighten expectations of another rate increase, which will cause movement in the markets," said Bob Walters, chief economist of Loans.

Publish Date: 07/19/2006