Prices Jump Again in May, but Has Inflation Peaked?

A key measure of inflation rose in May, the Bureau of Economic Analysis reported Thursday, reflecting the ongoing economic impact of the war against Iran.

The Personal Consumption Expenditures price index, which is the preferred inflation measure of the Federal Reserve, rose 0.4% on a monthly basis and 4.1% on a yearly basis. The monthly reading was stable from the month before, but the annual number was higher than April's 3.8% reading and the highest since April 2023.

Perhaps more worrisome, growth in the core PCE index — which ignores volatile food and fuel prices — also accelerated, rising 0.3% on a monthly basis and 3.4% on a yearly basis. The core index provides a clearer sense of the underlying trend, and while the monthly reading was stable from April to May, the annual reading rose by a tenth of a percentage point, indicating that upward pressure on prices is significant and rising, even if energy prices are ignored.

Almost over or more to come? Many economists think headline inflation likely topped out in May, when oil and gasoline prices hit highs during the war with Iran. Since then, as the war has wound down, oil prices have dropped 30% or more. That drop should be

Fuente original: Yahoo Finance (https://finance.yahoo.com/economy/policy/articles/prices-jump-again-may-inflation-230102836.html)