The Federal Reserve plans to cut interest rates only once this year as inflation remains high
Inflation slowed in May, according to new data released Wednesday, providing some good news just hours before the Federal Reserve is due to make its final interest rate announcement.
Consumer prices rose 3.3% from a year earlier, slowing from April’s 3.4% rate, according to the Bureau of Labor Statistics’ latest consumer price index report released Wednesday.
On a monthly basis, prices remained stable, at a slower pace than the 0.3% increase recorded in April.
This is the first time since July 2022 that the CPI has not increased on a monthly basis.
Economists had expected a monthly increase of 0.1% and an annual gain of 3.4%, according to FactSet consensus estimates.
Lower gasoline prices, which fell 3.6% from April, helped slow inflation in May. They are still up 2.2% on the year. Food prices were stable and overall food prices rose 0.1%, boosted by a slight acceleration in food service inflation.
However, housing inflation more than offset the decline in gasoline prices, rising 0.4% for the fourth straight month, underscoring the pressure Americans are feeling from housing-related expenses.
Excluding gasoline and food, categories that tend to be volatile, the closely watched “core” measure rose just 0.2% for the month (its slowest pace since October last year), and its annual rate fell to 3.4%, setting a new three-year low.
cnn
