US GDP Inflation Hits 6.3% in Q2, Core Measures at Multi-Year Highs
The Bureau of Economic Analysis has published its quarterly inflation statistics for GDP accounts, showing a significant increase in overall inflation in the US economy. In Q2, the GDP deflator indicated an annualized inflation rate of 6.3%, the highest since Q2 2022. Year-over-year, GDP inflation surged by 4.3%, marking the worst performance since Q1 2023. Excluding food and energy, core GDP inflation also rose, reaching 4.4% annualized in Q2 and 3.8% year-over-year, both the worst since Q1 2023. Additionally, the quarterly PCE price index experienced a 5.1% annualized increase in Q2, the second highest since Q1 2022. The Federal Reserve's 2% inflation target seems increasingly distant, with the 30-year Treasury yield hitting its peak since 2007.
Key facts
- GDP deflator inflation in Q2 was 6.3% annualized, worst since Q2 2022.
- Year-over-year GDP inflation was 4.3%, worst since Q1 2023.
- Core GDP inflation (excluding energy and food) rose 4.4% annualized in Q2, worst since Q1 2023.
- Year-over-year core GDP inflation was 3.8%, worst since Q2 2023.
- Quarterly PCE price index jumped 5.1% annualized in Q2, second worst since Q1 2022.
- Year-over-year PCE price index was 3.8%, worst since Q2 2023.
- Core PCE price index rose 3.4% annualized in Q2, second worst since Q1 2024.
- Year-over-year core PCE inflation was 3.3%, worst since Q2 2023.
- Inflation has been accelerating for four consecutive quarters on a year-over-year basis.
- 30-year Treasury yield hit highest level since 2007.
Entities
Institutions
- Bureau of Economic Analysis
- Federal Reserve
- FOMC
- WOLF STREET
Locations
- United States