Up 4.2% (2.9% core, i.e. stripping out food and energy) over the last 12 months before seasonal adjustment.
The higher-frequency data are more concerning. CPI “increased 0.5 percent on a seasonally adjusted basis in May, after rising 0.6 percent in April” and 0.9 percent in March [1]. (0.3, 0.2, 0.3 percent for December, January, February, respectively.)
So a linear trend of 6% from March, closer to 9% if one extrapolates the March-April-May quarter. Almost all of that driven by food and energy. Core spiked to 0.4% MoM in April, but calmed down to 0.2% in May, on trend with pre-war numbers. It’s up 2.9% YoY, but trending a bit lower. (Looked at another way, we’ve already “booked” 2.5% of inflation for ‘26. If we continue at 0.5% MoM, we close the year +5.6%. Even if it drops to pre-war 0.2%, we’re still going to be +3.8%. Given the resumption of hostilities, I’m betting we’ll be closer to the former.)
Together with the jobs numbers, it would be weird for an independent Fed to not raise rates.
> Together with the jobs numbers, it would be weird for an independent Fed to not raise rates.
Not really. They may believe the inflation is driven by supply shocks, not excess demand. For example, the oil blockade. Raising already restrictive rates wont increase the supply of oil.
They don't even need to be right. If they simply believe this is what's driving inflation, they could decline to raise rates without that necessarily indicating a lack of independence.
Personally I expect the FED not to be independent and to let inflation run a little hot while lowering rates to attack the debt from 2 angles. But even still, its not true that high CPI + not lowering rates = non-independent fed
> They may believe the inflation is driven by supply shocks, not excess demand
Fair enough, I regret my edit. It would be unusualy for the Fed not to hold or raise rates.
Lowering rates, on the other hand, would be a clear WTF move.