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The inflation rate in the US drops nine tenths, to 4% in May

The inflation rate in the US drops nine tenths, to 4% in May

The year-on-year rate of inflation in the United States continues to decline, falling for the eleventh consecutive month in May, and stood at 4%, nine tenths less than in April, according to data published this Tuesday by the Bureau of Labor Statistics (BLS).

The drop is the second steepest decline since the indicator started to decline in July 2022 and 4% is the lowest figure since March 2021. In monthly terms, prices rose one tenth.

These data are known on the day the meeting of the members of the Federal Open Market Committee of the Federal Reserve (FOMC) begins, in which they will decide whether to continue raising interest rates or whether to pause.

Data such as inflation will define the decision, which the Fed will announce this Wednesday.

In May, the housing index was again the one that contributed the most to the monthly increase of all articles, with a rise of six tenths. year on yearhas increased 8% compared to May 2022.

The food index rose 0.2% in May after being flat in the previous two months. The year-on-year rise is 6.7%.

The energy index, on the other hand, decreased by 3.6% in May due to the fall in the main energy component indices and one year energy prices have fallen by 11.7%.

Core inflation, which measures the rise in consumer prices minus food and energy prices, the most volatile, rose 0.4% in May, the same amount as in April and March. It placed its interannual rate at 5.5%, two tenths less than in April.

Since reaching its peak of 9.1% in June 2022, the inflation rate has been going downor, among other things, due to the drop in energy prices. Consecutive rate hikes that seek to cool the economy to reduce inflation have also helped.

The last one, the tenth increase, took place at the beginning of May and was 0.25 points, Therefore, interest rates are currently in a range between 5 and 5.25%.

The president of the regulator, Jerome Powell, explained in the press conference after the announcement that future rate hikes will depend on the macroeconomic figures recorded by the country and that data such as unemployment or the inflation rate will be essential to decide whether to stop. the climbs.

At the beginning of June the latest employment data was released, which fell three tenths in May, to stand at 3.7%.

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