May 2026 CPI inflation: BLS report shows consumer prices rose last month
The Mornings with Maria panel analyzes markets, the impact from the Iran conflict and invests in government-owned companies.
This story about the May 2026 CPI inflation report is developing and will be updated with more details.
Inflation has skyrocketed in May as American consumers continue to face higher gasoline prices amid the impact of the Iran war on the energy market and the economy as a whole.
The Bureau of Labor Statistics (BLS) said Wednesday Consumer price index (CPI) – a broad measure of how much everyday goods such as fuel, groceries and rent cost – rose 0.5% from last month and 4.2% higher than a year ago. The annual figure is the highest since April 2023.
Expectations versus reality
Both the 0.5% monthly increase and the 4.2% increase from a year ago were in line with the expectations of economists polled by LSEG.
So-called core prices, which exclude variable rates of fuel and food to better gauge price growth trends, were up 0.2% monthly and 2.9% from a year ago. The monthly figure was a cooler than expected 0.3% increase, while the core figure for the year was in line with economists’ forecasts.
INFLATION HURTS AMERICAN CONSUMERS AND THE FED’S NEWEST REPORT SHOWS IT WILL GET WORSE.
Cost of living deterioration
High inflation has put a lot of financial pressure in recent years on many US households, who are forced to pay more for everyday necessities like food and rent. Inflation is especially hard on low-income Americans, because they tend to spend more of their already stretched paychecks on necessities and have less flexibility to save.
Energy prices rose 3.9% in May amid Iran’s war-torn Middle East oil supply disruptions, with prices up 23.5% a year earlier. The BLS noted that the energy index accounted for more than 60% of the total CPI in May.
Gasoline prices increased 7% monthly in May and are up 40.5% compared to last year. Electricity prices increased by 0.6% last month and increased by 5.9% compared to last year. Utility gas service prices fell 0.5% in May and rose 3% year-over-year.
Gasoline prices rose slightly more than 40% from last year in May, the BLS report said. (Ariana Drehsler/Bloomberg via Getty Images)
Food prices rose 0.2% in May and are 3.1% higher than a year ago. The household food index increased by 0.1% in the month and 2.7% compared to last year. The consumption away from home index rose 0.3% month-on-month and 3.5% year-on-year.
Prices of meat, poultry and fish decreased by 0.4% in May but increased by 6.2% compared to last year. Beef and veal prices fell 1.6% for the month but remained up 12.9% for the year. Egg prices rose 4% in May but fell 35.2% year-on-year as supplies normalized after an outbreak of bird flu. Fruit and vegetable prices increased by 0.2% in the month and increased by 6.1% compared to last year.
House prices were up 0.3% in May and 3.4% higher than a year ago. Homeowners and home insurance prices were up 0.5% month-over-month and 6.9% year-over-year.
Transportation service prices fell 0.6% in May and rose 4.1% from a year ago. Air fares caused the biggest increase, as they increased by 2.7% in May and increased by 26.7% compared to last year.
What do the experts say?
What does it mean for markets
Futures for the benchmark S&P 500 index fell about 0.5% following the release of the inflation report before the market opened.
