The U.S. cost of living accelerated in May as Americans paid more for a broad range of goods and services, according to a government report released Friday, June 10. Higher consumer prices boosted the rate of annual inflation to its highest level in more than four decades.
Soaring food, energy and shelter prices contributed the most in driving up inflation — on a monthly and annual basis. Grocery prices saw their biggest 12-month gain in over 43 years. Inflation data shows other categories of pricing increases as well, like spiking airline fares and a return to higher vehicle prices — both new and used.
In the headline monthly figure, U.S. consumer prices increased 1% in May, the Labor Department said in its monthly report on the Consumer Price Index (CPI). The CPI is a broad measure of what Americans pay for everyday items ranging from clothing to cars. Consumer prices rose 0.3% in April while they soared 1.2% in March, registering their largest monthly gain since September 2005.
"It’s hard to look at May’s inflation data and not be disappointed," CNBC quoted Morning Consult’s chief economist, John Leer. "We’re just not yet seeing any signs that we’re in the clear."
Food prices rose 1.2% with grocery prices up 1.4% and the cost of dining out advancing 0.7%. Food prices soared 10.1% year-on-year, for their biggest annual increase since February 1981, with costs soaring 11.9% for groceries — the most since April 1979 — and 7.4% for food away from home.
Prices at the pump climbed 4.1% in May after falling 6.1% in April, which was their first monthly decline since January. Gas prices surged 48.7% from a year earlier.
The broader index for energy, which combines items like gasoline, electricity, and fuel oil, increased 3.9% last month after sliding 2.7% previously. Energy prices rose 34.6% from a year ago.
Excluding the more volatile food and energy components, the rate of core consumer prices rose 0.6% for a second month in a row. The recent monthly paces are still contrasting to June when the core rate at 0.9% was the highest for a month since April 1982.
"While almost all major components increased over the month, the largest contributors were the indexes for shelter, airline fares, used cars and trucks, and new vehicles. The indexes for medical care, household furnishings and operations, recreation, and apparel also increased in May," the Labor Department’s monthly report said.
Shelter or housing costs picked up 0.6% in May, their largest monthly increase since March 2004, following three straight monthly gains of 0.5%, and they advanced 5.5% from a year earlier for their biggest 12-month increase since February 1991. Components of shelter include pricing items like rent for apartments, rental equivalence, lodging away from home such as hotels and motels, and housing at schools. The index accounts for about one-third of the entire CPI.
Airline fares jumped 12.6% last month after soaring 18.6% in April for their biggest 1-month increase since the inception of the series in 1963. They are 37.8% higher year-over-year.
Clothing prices rose 0.7% after declining 0.8%, and they advanced 5% from a year earlier.
New vehicle prices rose 1%, for their thirteenth increase in fourteen months, after rising 1.1% previously. Prices increased 12.6% from a year ago.
Used car and truck prices rose 1.8% following three consecutive monthly declines, and are 16.1% higher than a year ago.
In the headline annual figure, inflation rose 8.6% over the past 12 months, the highest inflation rate since December 1981, and after rising 8.3% previously. The level has now topped 6% for eight straight months and has been at or above 7% for six months in a row.
Core inflation rose 6% over the past year after advancing 6.2% in April. In the period ending March, the core rate at 6.5% was the highest since August 1982. The core, "all items less food and energy" index is one of the benchmark inflation rates monitored by the Federal Open Market Committee (FOMC) as it helps the central bank decide where to set its key interest rate.
"Of all the bad news in today’s CPI report, the worst was ‘broad-based,’" MarketWatch quoted corporate economist Robert Frick of Navy Federal Credit Union. "Each time a new category adds significantly to the CPI, that means high inflation will last longer and that the Fed is more likely to crank up interest rates higher and faster."
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 10, 2022. 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 2021 to May 2022 Consumer Prices – Gains & Losses in Percent
|Nov. 2021||Dec. 2021||Jan. 2022||Feb. 2022||March 2022||April 2022||May 2022||12 Month|
|Food at home||0.9||0.4||1.0||1.4||1.5||1.0||1.4||11.9|
|Food away from home||0.6||0.6||0.7||0.4||0.3||0.6||0.7||7.4|
|Gasoline (all types)||4.5||1.3||-0.8||6.6||18.3||-6.1||4.1||48.7|
|Utility (piped) gas service||0.3||-0.3||-0.5||1.5||0.6||3.1||8.0||30.2|
|All items less food, energy||0.5||0.6||0.6||0.5||0.3||0.6||0.6||6.0|
|Commodities less food, energy||0.9||1.2||1.0||0.4||-0.4||0.2||0.7||8.5|
|Used cars and trucks||2.4||3.3||1.5||-0.2||-3.8||-0.4||1.8||16.1|
|Services less energy||0.4||0.3||0.4||0.5||0.6||0.7||0.6||5.2|
The BLS releases inflation data around the middle of a month for consumer prices surveyed up to the previous month. The Consumer Price Index (CPI) for June and the latest annual period become public on July 13, 2022.
CPI data is used in calculating inflation rates and in this site’s U.S. Inflation Calculator. The US Inflation Calculator shows cumulative inflation and the change in buying power of the U.S. dollar over time.