This story about the May 2026 CPI inflation report is developing and will be updated with more details.
Inflation ticked higher in May as American consumers continued to face elevated fuel prices amid the Iran war's impact on the energy market and across the economy.
The Bureau of Labor Statistics (BLS) said on Wednesday that the consumer price index (CPI) – a broad measure of how much everyday goods like gasoline, groceries and rent cost – rose 0.5% from a month ago and is 4.2% higher than a year ago. The annual figure is the highest since April 2023.
Both the 0.5% monthly increase and the 4.2% rise from a year ago were in line with the expectations of economists polled by LSEG.
So-called core prices, which exclude volatile measurements of gasoline and food to better assess price growth trends, were up 0.2% on a monthly basis and 2.9% from a year ago. The monthly figure was slightly cooler than the expected rise of 0.3%, while the annual core figure was in line with economists' predictions.
INFLATION IS SQUEEZING AMERICAN CONSUMERS AND THE FED'S LATEST REPORT SHOWS IT'S GETTING WORSE
High inflation has created severe financial pressures in recent years for most U.S. households, which are forced to pay more for everyday necessities like food and rent. Price hikes are particularly difficult for lower-income Americans, because they tend to spend more of their already-stretched paychecks on necessities and have less flexibility to save.
Energy prices rose 3.9% in May amid the Iran war's disruption of Middle Eastern oil supplies, with prices up 23.5% in the last year. The BLS noted that the energy index accounted for over 60% of the overall CPI increase in May.
Gasoline prices increased 7% on a monthly basis in May and are up 40.5% compared with a year ago. Electricity prices rose 0.6% last month and are up 5.9% from a year ago. Utility gas service prices fell 0.5% in May and are up 3% year over year.
Food prices were up 0.2% in May and are 3.1% higher than a year ago. The food at home index was up 0.1% for the month and 2.7% compared with last year. The food away from home index rose 0.3% on a monthly basis and 3.5% year over year.
Meats, poultry and fish prices were down 0.4% in May but are up 6.2% from last year. Beef and veal prices fell 1.6% for the month but remain up 12.9% on an annual basis. Egg prices increased 4% in May but are down 35.2% year over year as supply normalized after an avian flu outbreak. Fruits and vegetables prices rose 0.2% for the month and are up 6.1% from a year ago.
Housing prices were up 0.3% in May and are 3.4% higher than a year ago. Tenants' and household insurance prices were up 0.5% on a monthly basis and 6.9% year over year.
Transportation service prices were down 0.6% in May and are up 4.1% from a year ago. Airline fares accounted for much of the increase, as they rose 2.7% in May and are up 26.7% from last year.
Futures for the benchmark S&P 500 index were down about 0.5% following the release of the inflation report ahead of the market open.