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MNI BRIEF: US May CPI Jumps 1.0%, More Than Expected

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U.S. CPI inflation jumped 1.0% in May after rising 0.3% in April as gasoline prices rebounded, while core CPI rose 0.6%, same as the previous month. Both were more than market analysts expected. On a 12-month basis, CPI rose 8.6%, the most since December 1981, and core CPI rose 6.0%.

Headline CPI was boosted by energy and food prices. The energy index rose 3.9% from April as gasoline spiked 4.1%. The food index rose 1.2%, with food at home increasing 1.4%. The Core CPI was led by shelter costs, rising 0.6%, the most since March 2004, with owners' equivalent rent rising 0.6%. Airfares continued to rise by 12.6% in the month, slightly slower than in April. Used cars and trucks rebounded by 1.8% after falling in the previous three months.

The report will likely stoke inflation concerns at the Federal Reserve. Former Fed Governor Randall Kroszner told MNI the central bank will likely raise interest rates by a half point in the next three meetings to tame prices. (See: MNI INTERVIEW: Fed Set For Three 50BP Rate Hikes - Kroszner)

Source: BLS

MNI Washington Bureau | +1 202-371-2121 | jean.yung@marketnews.com
MNI Washington Bureau | +1 202-371-2121 | jean.yung@marketnews.com

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