**MNI DATA IMPACT: US May CPI As-Expected +0.1%, Core +0.1%>

--Core CPI Below +0.2% Expected; Owners Equivalent Rent +0.3%

--Apparel Prices Flat Following Two Straight Declines

By Kevin Kastner and Harrison Clarke

     WASHINGTON (MNI) - The May CPI data were roughly in line with 

expectations, allowing overall year/year inflation to decelerate, data 

released by the Bureau of Labor Statistics Wednesday showed. 

     Overall CPI rose by 0.1%, as expected in both the Bloomberg and MNI 

surveys, while core prices were also up 0.1%, below the 0.2% gain 

expected. 

     Here are some of the key takeaways from the data released 

Wednesday: 

     - The core CPI reading rose 0.113% unrounded, so it was closer to 

0.1% than 0.2%. 

     - Apparel prices, which were expected to rebound after declines in 

the previous two months, posted a flat reading in May. 

     - The major core components showed generally positive readings. The 

large owners' equivalent rents category rose by 0.3% and medical care 

was up 0.3%. However, new vehicle prices rose by only 0.1%, used vehicle 

prices fell 1.4% and recreation prices fell 0.3%. 

     - Energy prices fell by 0.6% in May after solid gains in the 

previous three months, with gasoline prices down 0.5%. Electricity 

prices were down 0.8% and gas utilities prices fell 1.0%. CPI excluding 

only energy was up 0.1%, while food prices were up 0.3% on generally 

upward movements in the major categories. 

     - As a result of the modest 0.1% rise in overall CPI, the year/year 

rate fell to +1.8% from +2.0% in April. Excluding only energy, the 

year/year rate remained at +2.0%, and the year/year rate for core prices 

fell to +2.0% after rising to +2.1% in April, holding in the same tight 

range seen so far in 2019. 

     ** MNI Washington Bureau: 202-371-2121 ** 

[TOPICS: MAUDS$,MT$$$$,M$U$$$,MAUDR$]