A key inflation gauge increased in May, signaling that prices remain high despite a modest decrease in spending by Americans. According to the Commerce Department, prices rose 2.3% from last year, with core prices rising 2.7%. This is above the Federal Reserve’s 2% target.
Spending fell 0.1%, marking the first decline since January. The reduction may be due to Americans buying more cars and other manufactured goods in anticipation of tariffs before cutting back on spending.
Despite this, inflation remains stubbornly elevated, partly offset by falling prices for new cars, airline fares, and apartment rentals.
Source: https://abcnews.go.com/US/wireStory/key-inflation-gauge-rose-month-americans-cut-back-123266158