Prices jumped 9.1% in June, as consumers faced rapidly rising gas, food and rent costs, a higher-than-expected reading and bad news for Americans at a time when their wages are falling further in relation to the soaring cost of living in the country.

The new data contained particularly worrisome signs for the Federal Reserve, proving that price pressures are broad and tenacious in ways that can make them difficult to contain.

Overall, inflation is expected to moderate in July as gasoline prices have fallen this month – a gallon of regular gasoline averaged around $5 in June, and the cost is now hovering around $4.63. But fuel prices are volatile, making it impossible to know whether today’s gas price decline will last and the report suggests underlying inflationary pressures have remained intense.

In particular, a core inflation index that excludes food and fuel prices to give an idea of ​​the general trend remained surprisingly high. That metric climbed 5.9% in the year through June, barely a slowdown from last month’s 6% increase. Core prices also jumped 0.7% from May to June, more than the previous monthly increase.

Persistent price gains portend trouble for President Biden, whose approval ratings have taken a hit amid rising costs, and could force the Fed to act forcefully. The central bank is raising rates to slow the economy and try to contain inflation, and it will likely continue to adjust policy quickly – even if it risks tipping the economy into a recession – as the inflation seems increasingly out of control.

“It’s an ugly report,” said Julia Coronado, the founder of MacroPolicy Perspectives. “I don’t think there’s anything good in this report, as far as the Fed is concerned, as far as the American consumer is concerned.”

The global economy has been rocked by a series of shocks that have pushed inflation higher since the start of the pandemic. Factory closures and shipping shortages have disrupted supply chains, and labor shortages are making it harder for airlines to fly at capacity and for hotels to rent rooms. Russia’s invasion of Ukraine has disrupted gas and food supplies.

Credit…Erin Schaff/The New York Times

While economic policymakers initially hoped the turmoil would subside and prices would calm down on their own, they have stopped waiting for that to happen – especially as the price increases are proving not only steep but also pervasive, growing rapidly across a range of goods and services.

The Fed has raised interest rates since March in a bid to dampen consumer and business demand, hoping to cool the economy and bring down inflation. The central bank accelerated these rate moves as price increases proved surprisingly tenacious, and the new inflation report spurred speculation that the Fed could become even more aggressive.

Officials raised rates by 0.75 percentage points in June, the biggest move since 1994, and were expected to make a similar sized move when it meets in late July. But following the new inflation data, investors began to expect a percentage point move, depending on market prices.

The fact that core inflation rose on a monthly basis is “particularly concerning for the Fed,” said Blerina Uruci, economist at T. Rowe Price. “It sends a general signal: it’s not driven by one or two volatile components.”

The Fed risks tipping the economy into a recession by rapidly raising interest rates, as these increases could dampen the economy so hard that they rattle businesses, prompting them to stop hiring and trigger a reaction chain in which households find themselves with less money to spend.

But policymakers say they need to stifle inflation quickly, even if it raises the risk of a painful slowdown. Indeed, they fear that, as inflation remains rapid, consumers and businesses will get used to it.

If people start asking for higher wages in anticipation of price increases — negotiating cost-of-living adjustments of 6 or 7 percent, for example, instead of the usual 2 to 3 percent — companies might try to pass on their rising labor costs on customers by raising prices. This could perpetuate rapid inflation, making it much harder for the Fed to stamp it out.

“The higher number is cause for concern,” Raphael Bostic, president of the Federal Reserve Bank of Atlanta, told reporters on Wednesday. “It’s all on the line – I have to understand, work with my team, to really get a sense of what it looks like and what it means in terms of the overall trajectory of inflation.”

Mr Bostic said he was “not committed to any specific course of action”.

Credit…Amir Hamja for The New York Times

Inflation is high in much of the world right now as Russia’s invasion of Ukraine drives up food and fuel prices and supply chain issues continue to keep some goods in shortage. But the new inflation report also shows evidence of price pressures that have little to do with global supply. Restaurant meals, tickets to sporting events and other services are increasingly expensive.

For consumers, the new report confirms that it is increasingly difficult to make ends meet. As wages rise, they have failed to keep up with rapid price increases. After taking into account price increases, wages have fallen by 3.6% over the past year. At the same time, basic necessities are becoming more and more expensive. Overall food prices rose 10.4% in June from a year earlier, the biggest annual increase since 1981. Renting a house or apartment also costs a lot more expensive, having grown at the fastest monthly rate since 1986.

This makes life difficult for many families. Soaring housing prices have made it difficult for Elizabeth Haynes, 41, who lives with her husband in McKinney, Texas, to move. The couple want to move to another state, but high housing costs have so far been prohibitive.

“We’re trying to get out of Texas, and it’s proving really difficult with rental costs and housing costs and shortages and all that,” said Ms Haynes, who hopes to land a place she can afford in Connecticut. . “So that’s kind of our big problem.”

While rapid price increases are weighing on many Americans, they are also weighing on economic confidence, posing a big challenge for Mr. Biden and Democrats ahead of the midterm elections. Mr Biden acknowledged the pain caused by inflation, saying in a statement on Wednesday that it was “unacceptably high”.

But he also called the report “outdated” because it failed to capture the recent drop in pump prices for gas and other commodities. Democrats have suggested things will improve soon, pointing out that as fuel costs come down, headline inflation is expected to come down from its June level of 9.1%.

“I think we’re peaking — I think we’re going to come down from here,” said Rep. Nancy Pelosi, the House Speaker, when asked for her reaction to the new data.

While there is hope in Washington and on Wall Street that inflation will decline sustainably, economists have repeatedly suggested that inflation peaked in the past 12 months only to pick up again.

This is partly because the prices of certain goods have behaved in strange ways: cars have been scarce and their prices have skyrocketed, for example. It’s also partly because economists dismissed sharp swings in the prices of various goods and services as temporary one-off events, and the surprises kept piling up.

“People haven’t done a very good job of predicting car inflation,” said Harvard economist Jason Furman. “Beyond that, inflation is about more than 10 individual stories about 10 individual goods and services – these are about forces in the overall economy.”

Credit…Hiroko Masuike/The New York Times

That said, there are some reasons why today’s rapid price gains may fade depending on the fundamentals of the economy.

Consumers may struggle to maintain spending as prices rise. If they move in with roommates, stop taking vacations, or give up social activities to try to save money, supply could start catching up with demand, causing price gains to decelerate.

Stores including Target are already trying to sell bloated inventory, which could allow retail prices to slow in the future. Costs of goods, including sports equipment and televisions, have already started to fall.

But, for now, hints and predictions of a cooling likely won’t be enough comfort to economic policymakers as the data hardly suggests a concerted pullback is on the way.

“We have to be so humble about the inflation forecast,” said Ms. Uruci of T. Rowe Price, who expects inflationary pressures to subside. “We just got it wrong, so consistently, in one direction.”

Reporting was provided by Isabella Simonetti, Jim Tankersley, Emily Cochrane, Ana Swanson and Joe Rennison.