US consumer prices rose inflation surged to its highest level since February, driven in part by President Donald Trump’s sweeping tariff regime, which is raising the cost of everyday items such as furniture, clothing, and large appliances, according to fresh government data.

The Labor Department reported Tuesday that consumer prices rose 2.7% in June compared to a year earlier, up from a 2.4% increase in May. Month-over-month, inflation climbed 0.3%, accelerating from a 0.1% rise the previous month.

Tariffs rising costs

The uptick comes as the Trump administration has imposed broad tariffs — including a blanket 10% levy on all imports, 50% duties on steel and aluminum, 30% on Chinese goods, and 25% on imported cars. The president recently threatened a new 30% tariff on European Union imports starting August 1.

Prices rose across a range of goods: gasoline jumped 1% from May to June, grocery prices edged up 0.35%, and appliance prices climbed for the third straight month.

Several companies have confirmed they are raising prices due to the duties. Walmart, Nike, and Mitsubishi have announced targeted or average price hikes, while others delayed increases by stockpiling inventory earlier in the year.

Political and policy fallout by US consumer prices rose

The inflation rise poses a political challenge for President Trump, who campaigned on lowering consumer costs. It also complicates efforts to pressure the Federal Reserve into cutting interest rates.

While Trump has repeatedly claimed there is “no inflation” and demanded that the Fed slash its benchmark rate from 4.3% to 3%, Fed Chair Jerome Powell has signaled caution. Powell said the central bank wants to observe how the economy responds to the tariffs, which are simultaneously driving prices higher and threatening to slow growth.

Trump sharply criticized Powell on Monday, calling him “terrible” and accusing him of not knowing “what the hell he’s doing.” White House officials have also attacked Powell over ballooning costs tied to renovations of two Fed buildings, now projected at $2.5 billion — a third more than initially estimated.

While Trump legally cannot fire the Fed chair over policy disagreements, some legal interpretations suggest removal could be possible “for cause,” such as mismanagement.

Core inflation also rises

Stripping out volatile food and energy prices, core inflation rose 2.9% year-over-year in June, up slightly from 2.8% in May. It increased 0.2% month-over-month. Economists track core inflation closely as a more stable indicator of long-term price trends.

Fed faces tightrope

The inflation spike may offer temporary relief to the Fed amid growing political pressure. But the conflicting signals — higher inflation alongside trade-induced economic uncertainty — make the central bank’s next move difficult to predict.

“The economy was doing well despite Powell,” Trump claimed Monday. “But it would be nice if we had rate cuts — people would be able to buy housing a lot easier.”

With inflation climbing and rates holding steady, Americans may face continued pressure on household budgets, even as businesses weigh whether to absorb or pass on tariff-related costs.