Inflation under the Trump Administration continued to defy expectations in May, remaining at the lowest level in more than four years, the U.S. Bureau of Labor Statistics (BLS) reported Wednesday, releasing its monthly Consumer Price Index (CPI) data.
Compared to a year earlier, the so-called “core” inflation rate, which excludes the volatile gasoline and food categories, held steady at 2.8% for the third straight month – remaining at the lowest level since March 2021. Economists had predicted a 2.9% increase.
Likewise, May’s 0.1% core increase from April came in lower than the 0.3% forecasted. It was also down from April’s 0.2% monthly increase and less than analysts’ 0.3% expectation.
“Since President Trump took office, inflation has come in below economists’ expectations every single month,” the White House noted, commenting on May’s BLS report.
May’s all-items CPI increased a seasonally-adjusted 0.1% from the previous month and a non-adjusted 2.4% over the past 12 months. In April, CPI recorded increases of 0.2% month-to-month and 2.3% year-to-year.
The index for shelter rose 0.3 percent in May, unchanged from April’s monthly increase, and was the primary factor in the all-items increase. Year-to-year, the shelter index was up 3.9% in May.
The food index increased 0.3% as both of its major components, the index for food at home and the index for food away from home, rose 0.3% in May. On a 12-month basis, food prices were 2.9% higher in May, due to increases both at (2.2%) and away from (3.8%) home.
In contrast, the energy index declined 1.0% in May as the gasoline index fell 2.6% over the month. Compared to a year earlier, the price of energy is down 3.5% and the cost of gasoline is 12.0% lower.
In its statement, the White House quoted cable news analysts expressing surprise at, but acknowledging, May’s upbeat inflation report:
- CNN’s Matt Egan: “We got ANOTHER month of positive inflation news. Despite these historic tariffs, the latest numbers do show that inflation remained relatively tame in May … This was better than expected … We did see a drop in energy prices. In particular, gas prices were low.”
- CNBC’s Mike Santoli: “There’s no way to look at these numbers and say they’re not welcome news.”
- CNBC’s Steve Liesman: “Not only did we get a decline in inflation expectations earlier this week from the important New York Fed report ... I do not see broader impacts on inflation from the tariffs.”
- CNBC’s Rick Santelli: “Inflation certainly looks like it is cooling.”
- Fox Business Network’s Maria Bartiromo: “That is much better than expected.”
- Commentator Adam Johnson: “Now we’re talking about numbers that are down in the low twos — under 2.5% — and we’re seeing that now for three months in a row, so this is wonderful news.”
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