Tribune Online, Author at Tribune Online

The United States Bureau of Labour Statistics, on Wednesday, disclosed that consumer prices rose less than anticipated in May, with tariffs imposed by President Donald Trump yet to show a significant effect on inflation. The Consumer Price Index (CPI), a broad measure of the prices paid for goods and services across the U.S. economy, rose 0.1% for the month. This put the annual inflation rate at 2.4%, matching economists’ expectations for the year but falling short of the projected 0.2% monthly gain, according to a Dow Jones survey. Core CPI, which excludes volatile food and energy prices, also increased by 0.1% monthly and 2.8% annually. These figures, according to CNBC, came in lower than the forecasted 0.3% and 2.9%, respectively. Federal Reserve officials typically focus on core inflation as a better gauge of underlying trends, and many have voiced concerns about potential inflationary pressures from tariffs. While the all-items annual inflation rate inched up by 0.1 percentage points from April, the core rate remained unchanged. Declines in energy prices helped counteract some cost increases. Items expected to rise due to tariffs, such as vehicles and apparel, surprisingly recorded price drops. Energy prices fell by 1% for the month, with new and used vehicle prices down by 0.3% and 0.5%, respectively. Gasoline prices saw a 2.6% monthly drop, contributing to a 12% year-over-year decrease. ALSO READ: US: Google offers buyouts to employees across company Food and shelter costs each rose 0.3% during the month. The Bureau of Labour Statistics noted that shelter was the “primary factor” behind the overall CPI increase. Despite a 2.7% monthly decline in egg prices, they remained 41.5% higher than a year earlier. Apparel prices fell by 0.4%. Though shelter costs edged higher, the 3.9% annual increase marked the slowest pace since late 2021. With inflation relatively contained, real average hourly earnings rose 0.3% for the month and were up 1.4% compared to a year earlier. “Today’s below forecast inflation print is reassuring – but only to an extent,” Seema Shah, chief global strategist at Principal Asset Management told CNBC, adding that “Tariff-driven price increases may not feed through to the CPI data for a few more months yet, so it is far too premature to assume that the price shock will not materialize.” Following the report, stock market futures turned positive, while Treasury yields moved lower. Vice President JD Vance echoed President Trump’s stance on interest rates, urging the Federal Reserve to cut rates given the subdued inflation data. “The president has been saying this for a while, but it’s even more clear: the refusal by the Fed to cut rates is monetary malpractice,” Vance wrote in a post on X. ALSO READ TOP STORIES FROM NIGERIAN TRIBUNE