On Wednesday, the Bureau of Labor and Statistics released its May Consumer Price Index (CPI) report detailing the impacts of inflation in the United States.
Many analysts hoped the report would show the worst of the inflationary numbers behind us before its release. According to a Reuters survey of economists, most analysts believed the report would show an increase of 0.2% last month, which would mean inflation is running at a rate of 8.1% higher than a year ago. It would be a better rate than April, when the index showed inflation for consumer products hit a 41-year-high, growing at an annual rate of 8.5%.
Economists have been saying for weeks that consumer prices likely peaked in April, which, if true, would signal a more vital economic reality for most Americans.
May’s report showed a 0.3% increase in April, reflecting an 8.2% increase in the cost of goods from April of 2021.
According to the report, “Increases in the indexes for shelter, food, airline fares, and new vehicles were the largest contributors to the seasonally adjusted all items increase.”
The report said that food costs had risen about 1% over the previous month.
The report further noted that gasoline prices had dropped about 6.1% for April. This number is not reflective of the recent price surge in gasoline currently making waves across the nation.
The report did note the massive increase in core costs for most Americans, saying, “The energy index rose 30.3 percent over the last year, and the food index increased 9.4 percent, the largest 12-month increase since the period ending April 1981.” This is confirmation of a 41-year high in the cost of goods for citizens of the United States.
Other significant areas of increase were in oil, which showed a 2.7% increase for the month. Also, new vehicles saw another monthly increase of 1.1%. Another significant areas of increase was in transportation services, which showed a 3.1% increase for the month.
While gasoline showed a decrease in the report, energy costs still show a significant increase over the previous year. The report notes that the “gasoline index increased 43.6% and the fuel oil index rose 80.5%. The index for electricity rose 11.0%, and the index for natural gas increased 22.7% over the last 12 months.”
The tourism industry marked some of the largest increases over the last month, with airfare reflecting an 18.6% increase and lodging showing a 1.7% increase, continuing growth after last month’s 3.3% increase.
Housing costs have continued to increase, with rent showing a 0.6% increase and general housing showing a 0.5% increase.
The monthly report details that “virtually all major components have increased” over the previous year.
It is unclear whether we have seen peak inflation. The current surge in gasoline prices, supply chain struggles, and international war are still putting pressure on the nation’s economy.