May inflation ‘mixed but concerning’

The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.5% on a seasonally adjusted basis in May, after rising 0.6% in April, the U.S. Bureau of Labor Statistics reported Wednesday. Over the last 12 months, the all-items index increased 4.2% before seasonal adjustment.

"May's CPI report offers a mixed but concerning picture. Headline inflation surged to a three-year high driven by energy prices, while core prices posted a moderate monthly gain, with core goods actually declining and shelter costs easing back toward more normal levels,” said America's Credit Unions Senior Economist Dawit Kebede. “With inflation accelerating and labor markets holding firm, the Fed's balance of risks has shifted more toward inflation. Markets are already pricing in a higher probability of a rate hike before year-end."