US annual inflation eases to 3.3% in May

US annual consumer price inflation cooled slightly in May, contrary to forecasts to stabilize at the same pace, despite steadying on a monthly basis in line with estimates, the Labor Department reported today, June 12. 

The US consumer price index (CPI), a broad inflation gauge that measures a basket of goods and services costs across the US economy, inched 3.3% higher during the 12-month period ended in May, versus a 3.4% hike in the April reading.

Its core counterpart — which excludes volatile food and energy prices — dropped to 3.4% in May, after reaching 3.6% and 3.8% in the previous two months, against estimates for a slowdown to 3.5%.

On a monthly basis, the seasonally adjusted CPI remained flat in May, although expectations had suggested a 0.1% rise. The core index, however, climbed by 0.2% monthly following a 0.3% uptick in April, in contrast to projections of a jump by the same percentage.

Elsewhere, shelter inflation gained 0.4% for the fourth consecutive month in May, offsetting the decline in gasoline prices. Besides, food prices added 0.1% on the month and 2.1% from a year ago.

Items contributing the most to the monthly leap in core consumer prices were shelter, medical care, used cars & trucks, and education.

Energy prices spiked by 3.7% year-on-year (YoY) in May but plunged by 2% on a monthly basis.