CPI report reveals inflation crept higher
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CPI inflation boosts stocks and bonds. Key drivers like car prices fall, supporting Fed rate cut hopes. Click for my full analysis of the data.
The Consumer Price Index rose 2.4 percent in May, from a year earlier, a reading that reflects only the initial impact of President Trump’s tariffs.
Core CPI, which factors out food and energy prices, rose 0.1% for an annualized rate of 2.8%. The readings, released by the Bureau of Labor Statistics on Wednesday morning, appear to show few inklings of the tariff ... a noticeable impact on pricing ...
Inflation dodged the tariff bullet again. The May Consumer Price Index rose +0.1% M/, less than the +0.2% consensus and the 0.2% increase in April.
Food inflation in May was up 10 bps to 2.9%. Downward pressure came from Meat, Poultry, Egg, Fish; offset by spike in cereals, fruits, vegetables, and other food at home. Energy inflation in May 2025 hardened 20 bps to -3.5%. Downward pressure again came from gasoline and piped gas; offset by a spike in electricity and fuel oil.
Inflation was tame in May but President Trump’s tariff policy may cause consumer prices to rise noticeably heading into summer, economists said.
European stocks fell after better-than-expected US inflation data failed to assuage investors’ worries over the impact of the Trump administration’s trade war on the world’s biggest economy.