WASHINGTON – Consumer prices fell slightly in May, a sign that inflation pressures remain muted.
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The consumer-price index, which measures what Americans pay for everything from dog food to doctors' visits, declined a seasonally adjusted 0.1% in May from the prior month, the Labor Department said Wednesday. Excluding the often-volatile categories of food and energy, so-called core prices rose 0.1% from April.
Economists surveyed by The Wall Street Journal had expected overall prices to hold steady and core prices to rise 0.2% on the month.
From a year earlier, consumer prices rose 1.9%, marking the third straight month annual gains have eased. Prices were up 1.7% on the year when excluding food and energy.
The report is the Federal Reserve's last peek at inflation before officials conclude a two-day policy meeting Wednesday afternoon. The central bank is expected to raise short-term interest rates in response to steady job creation and low unemployment.
While the labor market appears strong, inflation has softened in recent months.
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The Fed's preferred gauge, the price index for personal consumption expenditures, poked above the central bank's 2% target in February but settled down to 1.7% in April, the most recent month of data available.
The Fed is tasked with maintaining full employment and stable prices.
The consumer price index tends to run a little bit higher than the personal consumption index, reflecting different methods for calculating inflation. Both gauges have followed the same pattern, with price gains peaking in February and then easing.
In the May CPI report, gasoline was the main culprit behind falling prices. The gasoline index decreased 6.4% from April, but was up 5.8% from a year earlier. Food prices climbed 0.2% last month, and were up 0.9% from a year earlier.
Shelter costs--which account for about a third of the overall price index--increased 0.2% on the month and rose 3.3% on the year.
Elsewhere, inflation was weak. Monthly prices fell for apparel, airfare, communication and medical care services, the Labor Department said.
A separate Labor Department report showed average weekly earnings for private-sector workers, adjusted for inflation, increased 0.3% in May from the prior month. From a year earlier, inflation-adjusted weekly earnings were up 0.6%.
The Labor Department's latest report on the consumer-price index can be accessed at: https://www.bls.gov/news.release/cpi.nr0.htm
Write to Jeffrey Sparshott at firstname.lastname@example.org and Josh Mitchell at email@example.com.
(END) Dow Jones Newswires
June 14, 2017 08:45 ET (12:45 GMT)