WASHINGTON (AP) — U.S. consumer prices rose just 0.1% in June, as cheaper gas prices were offset by higher rents and auto costs.

The Labor Department said Thursday that the consumer price index increased 1.6% in June from a year earlier. That is down from 1.8% in May and the second straight drop. However, excluding the volatile food and energy prices, core inflation rose 0.3% in June, the biggest increase in 18 months. It rose 2.1% from a year ago.

Inflation has been muted throughout the 10-year expansion, now the longest on record, even as the unemployment rate has dropped to a very low 3.7%. Federal Reserve Chairman Jerome Powell cited persistently low inflation on Wednesday as a justification for potentially lowering short-term interest rates at the Fed's next meeting in late July.

Typically, such a low jobless rate would force employers to offer higher pay to attract and keep workers. Businesses, in turn, would raise prices to offset the cost of higher wages. But that dynamic has not fully kicked in during the current expansion and inflation has been stuck below the Fed's 2% target nearly the entire seven years since the Fed settled on that figure, according to a separate measure the Fed prefers.

Powell had previously described low inflation as transitory, but did not do so in his comments Wednesday during a hearing of the House Financial Services Committee. Instead, he highlighted the fact that very low unemployment wasn't pushing up wages quickly enough to lift prices, and suggested that meant hiring and economic growth could continue without fear the economy would overheat and push up inflation. That gives the Fed more room to cut rates.

In June, core inflation was pushed up by higher rents and a 1.6% jump in used car and truck prices, which followed four straight months of decline. Clothing prices rose 1.1%.

Some of the increase in core prices was likely temporary. The cost of household services jumped 0.8%, the most in nearly 30 years, as lawn and garden service costs soared 6.1%, the most since December 1997.

Food prices were unchanged, and gas prices fell 3.6%, the second straight sharp decline. The cost of electricity also fell 0.8%, lowering overall inflation.