Inflation rose higher than expected in May, with prices up 8.6% from a year ago for the fastest increase since December 1981, according to The Bureau of Labor Statistics’ May Consumer Price Index (CPI) released today.
Economists were expecting a 8.3% CPI increase in May, consistent with the reading from April.
On a month-over-month basis, the broadest measure of inflation claimed 1.0%, compared to 0.3% in April. “Core” inflation, which strips out the more volatile costs of food and gas, rose 6% over the prior year in May, more than the 5.9% that was expected.
Shelter, gas and food prices all contributed to the increase.
Energy prices broadly rose 3.9% from a month ago, bringing the annual gain to 34.6%. Within the category, fuel oil posted a 16.9% monthly gain, pushing the 12-month surge to 106.7%.
Shelter costs, which account for about a one-third weighting in the CPI, rose 0.6% for the month, the fastest one-month gain since March 2004. The 5.5% 12-month gain is the most since February 1991.
Finally, food costs climbed another 1.2% in May, bringing the year-over-year gain to 10.1%.
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