Washington (EFE) — U.S. consumer prices surged to 4.2% year-over-year in May, the highest level since April 2023 and in line with analyst forecasts, as energy costs driven by the Iran conflict continue to push inflation higher.
The figure, released Wednesday by the Bureau of Labor Statistics (BLS), is 0.4 percentage points above April’s reading and well above the 2.4% recorded in February — before the U.S. and Israel launched strikes against the Islamic Republic. Core inflation, which strips out volatile energy and food prices, rose to 2.9%, one-tenth of a point above April’s level.
Energy Is Driving the Bus
The ongoing Iran war — now past the 100-day mark amid a fragile ceasefire — has disrupted oil flows through the Strait of Hormuz, which Tehran blocked as retaliation and whose reopening remains tied to the stalled peace process. Energy prices were the dominant inflation driver in May, accounting for more than 60% of the monthly increase. The energy index rose 3.9% month-over-month in May, following gains of 3.8% in April and 10.9% in March. Gasoline prices climbed 7% in the month and are averaging above $4.15 per gallon nationally, according to AAA.
On an annual basis, the energy component is up 23.5%. Food prices rose 3.1% year-over-year, with grocery costs up 0.1% for the month and restaurant prices up 0.3%.
Housing costs, typically the largest single contributor to CPI, grew a relatively modest 0.3% for the month. Medical care, communications, airfares, personal care, and recreation all increased. New vehicles, furniture, and household items declined.
In monthly terms, overall CPI rose 0.5% in May, following a 0.6% increase in April. Core inflation grew 0.2% month-over-month, two-tenths of a point slower than in April.
White House Spins It, Fed Watches Closely
White House spokesman Kush Desai acknowledged “temporary disruptions” caused by the war but pointed to price drops in prescription drugs, dairy products, and automobiles as evidence of policy effectiveness under the Trump administration.
The reading puts the Fed in a difficult position. At more than double the central bank’s 2% target, the May figure reinforces market expectations of a rate hike later this year — directly at odds with President Trump’s repeated demands for aggressive rate cuts. The Fed meets June 16–17 in what will be the first session chaired by new Federal Reserve Chair Kevin Warsh, who will face immediate pressure to respond to the inflation trajectory.
