Picture inflation like a timid rabbit - it’s inching forward, not sprinting. In May, consumer prices hopped up just a tiny bit, surprising economists because everyone thought tariffs would launch prices into outer space. But instead, inflation stayed mellow…at least for now.
Here are Five Fast Facts on inflation:
- 🤏 Prices Up…A Little - The overall Consumer Price Index (CPI) rose 0.1% in May for an inflation rate of 2.4% year-over-year. This beat expectations of 0.2%. So yes, your snacks cost more, but not enough to cry into your ramen just yet.
- 💪 Core Prices Agreed - Excluding food and energy (which are always very volatile), “core” inflation rose only 0.1%, as well, compared to the forecast of 0.3%. #winning
- 🚫 No Tariff Shock - Economists expected Trump's tariffs to zap prices harder, but the impact was mild, and prices on many things expected to go up actually went down, including vehicles and apparel. So now's the time to stock up on cars and clothes, apparently!
- 📈 Some Upward Movement - A few segments did increase in prices, including food, which went up 0.3%, and shelter, which went up 3.9%. To be fair, though, that's the smallest increase in shelter prices since 2021, so we'll still call it a win for The Folks.
- ✋ Fed Stays Put - The Federal Reserve is likely keeping interest rates steady, waiting to see if tariffs push inflation higher before cutting. The White House is calling for them to take action now and lower interest rates, suggesting the inaction is the result of political games.
🔥Bottom line: In short, May’s inflation is like that nervous rabbit, poking its nose out to see if there's any danger. So far so good, but only time will tell if the rabbit goes leaping through the meadow or gets spooked and runs back into hiding. Keep an eye on prices and your piggy bank!
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