US consumers paid more for good and services in May than in the prior month, newly released inflation data from the government shows
Americans were spared some pain though, as the cost of gas flattened and grocery prices retreated overall. On the flip side, the cost to rent and own homes increased.
Consumer prices climbed 0.1% in May after falling 0.4% in April and dipping 0.2% in March. The increase came under forecasts made by many economists who were expecting a 0.2% advance.
Though gasoline prices were flat on a seasonally adjusted basis, energy prices as a whole went up 0.4%. That was due largely to a 0.8% uptick in electricity and a surge of 2.4% in natural gas.
Helping to offset some of the increases, overall food prices dipped 0.1% with the cost to fill the refrigerator and pantry down 0.3%. Some specific grocery products to decline were:
- Nonalcoholic beverages by 1.1%
- Dairy related produce by 0.8%
- Cereals and bakery products by 0.4%
Meats, poultry, fish and eggs were unchanged in May. The single grocery store food group to rise, up 0.4%, was fruits and vegetables.
Pulling the more volatile food and energy items from the mix, the so-called core US inflation rate rose 0.2% in May after advancing 01% in each of the two previous months. The increase was led by the cost of shelter — renting and home prices, which went up 0.3%. That grouping accounted for more than half of the rise in consumer prices, the US government reported.
"Besides the shelter increase, advances in the indexes for airline fares, recreation, and apparel also contributed to the rise," the Bureau of Labor Statistics said Tuesday, June 18, its monthly Consumer Price Index (CPI) report. "In contrast, the indexes for medical care and used cars and trucks declined in May."
Specific changes tracked by the Bureau of Labor Statistics included May increases in:
- Clothing by 0.2% after declining in the prior three months
- Airfares by 2.2% following a drop of 0.7% in April
- Recreation costs by 0.2% after falling 0.1% previously
Items that fell in price included:
- Used cars and trucks by 0.1%. They had jumped 0.6% in April for a fourth monthly advance.
- Medical care costs by 0.1% with medical care commodities down 0.5%
Unchanged were prices for new vehicles, tobacco, medical care services and household furnishings and operations.
US inflation over the past 12 months advanced 1.4%, rising from the previous increase of 1.1% in the 12 months ended April. Other recent inflation rates reported by the government on a 12-month basis for 2013 were 1.5% in March, 2% in February and 1.6% in January.
"We don’t really have an inflation issue in this country," Bloomberg quoted Omair Sharif, an economist at RBS Securities Inc. in Stamford, Connecticut. "Some Fed officials have expressed concern about inflation, but I think the Fed is cognizant of the fact that we’re probably at the low readings on inflation."
Core US inflation gained 1.7% year-over-year through May, matching the level in April. The core 12-month inflation rate was reported at 1.9% in March, 2.0% in the February and 1.9% in each of the three months before then. The core rate of inflation is closely watched by the Federal Reserve as it helps decide where the central bank sets its key interest rate. 1.7% remains below the Fed’s 2% inflation target.
"We wouldn’t expect the Fed to put too much weight on inflation being below its target," The Wall Street Journal quoted Paul Ashworth, chief U.S. economist at Capital Economics. The central bank could start to reduce its bond purchases by September, he said.
The following table offers major categories of US inflation data from November through May and over the past 12 months ended in May:
November 2012 – May 2013 Consumer Prices – Gains & Losses in Percent
|Nov 2012||Dec 2012||Jan 2013||Feb 2013||Mar 2013||Apr 2013||May 2013||12
|Food at home||0.3||0.2||.0||0.1||-0.1||0.1||-0.3||0.8|
|Food away from home||0.1||0.1||0.1||0.1||0.2||0.3||0.2||2.3|
|Gasoline (all types)||-6.0||-1.9||-3.0||9.1||-4.4||-8.1||.0||-4.1|
|Utility (piped) gas service||1.5||0.7||-1.7||1.2||1.0||4.4||2.4||14.2|
|All items less food, energy||0.1||0.1||0.3||0.2||0.1||0.1||0.2||1.7|
|Comm. less food, energy||-0.1||-0.1||0.2||.0||-0.1||.0||.0||-0.2|
|Used cars and trucks||-0.4||-0.3||0.2||0.8||1.2||0.6||-0.1||-1.6|
|Services less energy||0.2||0.2||0.3||0.2||0.2||0.1||0.2||2.3|
The US Bureau of Labor Statistics (BLS) has a scheduled release date of August 15, 2013 at 8:30 AM ET for its next set of Consumer Price Index data. This inflation information will provide the change in consumer prices through to the month of June 2013.
Along with all the published information, the CPI is the data used in this site’s US inflation Calculator that offers accumulated inflation between two entered dates as well as the change in the buying power of the U.S. dollar over time.