Supported by cheaper gasoline, U.S. consumer prices unexpectedly showed no overall increase in May. However, inflation remained stubbornly high compared to a year ago due to rising costs in areas such as food, housing, and healthcare.
"Indexes which increased in May include shelter, medical care, used cars and trucks, and education. The indexes for airline fares, new vehicles, communication, recreation, and apparel were among those that decreased over the month," the Labor Department’s monthly report noted.
The headline figure for the month shows that U.S. consumer prices were unchanged, compared to an increase of 0.3% in April, according to the Labor Department’s June 12 report on the Consumer Price Index (CPI). Forecasts had predicted a 0.1% monthly increase.
The CPI, a closely watched inflation gauge, measures what American consumers pay for everyday items ranging from eggs to electricity.
Overall, food prices for the month climbed by 0.1% after remaining steady in April. Within the food category, grocery prices were flat after falling by 0.2%, while dining-out expenses rose by 0.4% following two consecutive 0.3% increases.
Meanwhile, over the past year, food inflation increased by 2.1%, compared to a rate of 2.2% in each of the three prior periods. Grocery prices rose by 1% over the year, while dining-out costs increased by 4%. These figures contrast with their previous rates of increase, which were 1.1% for groceries and 4.1% for dining out.
In other sectors, there was a 3.6% decline in pump prices in May, contrasting with the 2.8% rise of the previous month. Comparing year-on-year, gas prices saw a 2.2% increase, against the previous rise of 1.2%.
The broader energy index, which includes items like gasoline, electricity, and fuel oil, fell by 2% after two consecutive 1.1% gains. Energy prices year-over-year advanced by 3.7%, which compares to the previously recorded increase of 2.3%.
Excluding volatile food and energy components, the rate of core consumer prices increased by 0.2% in May, compared to the expected 0.3% increase for the second consecutive month.
Shelter or housing prices increased by 0.4% for the fourth month, marking their 49th consecutive monthly rise, with a year-over-year increase of 5.4%. Recent 12-month comparisons show gains of 5.5% in April, 5.7% in both March and February, 6% in January, 6.2% in December, 6.5% in November, 6.7% in October, 7.2% in September, 7.3% in August, 7.7% in July, 7.8% in June, 8% in May, 8.1% in April, and 8.2% in March, the latter being their most significant annual increase since June 1982.
Components of shelter include prices of items like rent for apartments, rental equivalence, lodging away from home such as hotels and motels, and housing at schools. This index accounts for about one-third of the entire CPI.
In other closely watched pricing areas:
- Clothing prices declined 0.3% for the month after jumping by 1.2% previously. They advanced 0.8% from a year ago.
- New vehicle prices declined by 0.5% in May after falling by 0.4%. They showed a year-over-year decline of 0.8%.
- Prices for used cars and trucks rose by 0.6% during the month, following a 1.4% decrease previously. Compared to prices from a year ago, they plunged by 9.3%.
- When compared to the previous year, airline fares fell by 5.9%. As for the month, they dropped by 3.6% following a 0.8% decline.
In terms of the headline annual rate and in line with expectations, inflation rose by 3.3% for the 12 months ending May, compared to an expected 3.4% inflation rate and what was reported for the annual period ending in April.
For a broader perspective and a look further back, the inflation rate peaked at 9.1% during the 12-month period ending in June 2022. This was the fastest rate of inflation since November 1981. Additionally, until March 2023, inflation rates had remained at or above 6% for 17 consecutive months.
Meanwhile, core inflation increased by 3.4% in the year through May, compared to 3.6% previously and an estimate of 3.5%. This core "all items less food and energy" index is one of the benchmark inflation rates monitored by the Federal Open Market Committee (FOMC) to guide the central bank in setting its key interest rate.
As recently as September 2022, the annual core inflation rate at 6.6% was the highest since August 1982. Many economists consider the core reading as a better predictor for future inflation.
The following table of key inflation figures is for the last seven months through May, as published by the U.S. Labor Department’s Bureau of Labor Statistics (www.bls.gov/cpi) on June 12, 2024. To index the data each month, the BLS monitors the prices of about 80,000 consumer goods and services from around the nation. All monthly and annual pricing changes are in percentages.
November 2023 to May 2024 Consumer Prices – Gains & Losses in Percent
(Seasonally Adjusted from Prior Month and Unadjusted 12-Month)
| Nov 2023 | Dec 2023 | Jan 2024 | Feb 2024 | Mar 2024 | Apr 2024 | May 2024 | 12 Month | |
| All items | 0.2 | 0.2 | 0.3 | 0.4 | 0.4 | 0.3 | 0.0 | 3.3 |
| Food | 0.2 | 0.2 | 0.4 | 0.0 | 0.1 | 0.0 | 0.1 | 2.1 |
| Food at home | 0.0 | 0.1 | 0.4 | 0.0 | 0.0 | -0.2 | 0.0 | 1.0 |
| Food away from home | 0.4 | 0.3 | 0.5 | 0.1 | 0.3 | 0.3 | 0.4 | 4.0 |
| Energy | -1.6 | -0.2 | -0.9 | 2.3 | 1.1 | 1.1 | -2.0 | 3.7 |
| Energy commodities | -3.8 | -0.7 | -3.2 | 3.6 | 1.5 | 2.7 | -3.5 | 2.2 |
| Gasoline (all types) | -4.0 | -0.6 | -3.3 | 3.8 | 1.7 | 2.8 | -3.6 | 2.2 |
| Fuel oil | -1.1 | -3.3 | -4.5 | 1.1 | -1.3 | 0.9 | -0.4 | 3.6 |
| Energy services | 1.0 | 0.3 | 1.4 | 0.8 | 0.7 | -0.7 | -0.2 | 4.7 |
| Electricity | 1.0 | 0.6 | 1.2 | 0.3 | 0.9 | -0.1 | 0.0 | 5.9 |
| Utility (piped) gas service | 1.2 | -0.6 | 2.0 | 2.3 | 0.0 | -2.9 | -0.8 | 0.2 |
| All items less food, energy | 0.3 | 0.3 | 0.4 | 0.4 | 0.4 | 0.3 | 0.2 | 3.4 |
| Commodities less food, energy | -0.2 | -0.1 | -0.3 | 0.1 | -0.2 | -0.1 | 0.0 | -1.7 |
| New vehicles | 0.0 | 0.2 | 0.0 | -0.1 | -0.2 | -0.4 | -0.5 | -0.8 |
| Used cars and trucks | 1.4 | 0.6 | -3.4 | 0.5 | -1.1 | -1.4 | 0.6 | -9.3 |
| Apparel | -0.6 | 0.0 | -0.7 | 0.6 | 0.7 | 1.2 | -0.3 | 0.8 |
| Medical care | 0.5 | -0.1 | -0.6 | 0.1 | 0.2 | 0.4 | 1.3 | 3.1 |
| Services less energy | 0.5 | 0.4 | 0.7 | 0.5 | 0.5 | 0.4 | 0.2 | 5.3 |
| Shelter | 0.4 | 0.4 | 0.6 | 0.4 | 0.4 | 0.4 | 0.4 | 5.4 |
| Transportation | 1.0 | 0.1 | 1.0 | 1.4 | 1.5 | 0.9 | -0.5 | 10.5 |
| Medical care | 0.5 | 0.5 | 0.7 | -0.1 | 0.6 | 0.4 | 0.3 | 3.1 |
The BLS releases inflation data around the middle of the month, covering consumer prices surveyed up to the previous month. The Consumer Price Index (CPI) for June and the latest annual period will be made public on July 11, 2024.
The CPI data is also used to calculate inflation rates and power this site’s U.S. Inflation Calculator, which displays the cumulative inflation and the change in the buying power of the U.S. dollar over time.
