CPI preview: Inflation expected to have cooled further in May ahead of Fed decision [View all]

[mahatmakanejeeves]

It looks as if one of our Alexandras done got herself hitched.

CPI preview: Inflation expected to have cooled further in May ahead of Fed decision

Alexandra Canal·Senior Reporter
Mon, June 12, 2023 at 12:45 PM EDT

Inflation data set to be released by the Bureau of Labor Statistics on Tuesday will be a critical economic indicator ahead of the Federal Reserve's monetary policy decision later this week.

According to Bloomberg consensus estimates, May's Consumer Price Index (CPI) is expected to reveal headline inflation rose 0.2% over last month and 4.1% over the prior year, a slowdown from April's 0.4% month-over-month increase and 4.9% annual gain.

On a "core" basis, which strips out the more volatile costs of food and gas, prices in May are expected to have climbed 0.4% over the prior month and 5.2% over last year. ... A 4.1% jump in headline inflation would be the slowest annual increase since April 2021, but would still be significantly above the Federal Reserve's 2% target.

The Fed has been raising interest rates to try to bring down inflation, but the central bank risks sending the economy into a recession by hiking rates too high too fast. The Fed has signaled it could pause its hikes, saying it would continue to assess incoming data ahead of the June meeting.

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