Inflation continues to stay under wraps. The Consumer Price Index nudged 0.1% higher (1.8% y/y) during May following a 0.3% April rise. It was the smallest increase since January. The gain matched expectations in the Action Economics Forecast Survey. The CPI excluding food & energy also rose 0.1% (2.0% y/y) for the fourth consecutive month. A 0.2% gain had been expected.

Core goods prices continued to decline. The 0.1% easing (-0.2% y/y) pushed them lower for the fourth straight month. The decline was led by a 1.4% drop (+0.3% y/y) in used car & truck prices. Education & communications goods prices fell 0.5% (-6.0% y/y), off for the fifth straight month. Appliance prices eased 0.8% (+2.4% y/y) and medical care product prices fell 0.4% (-0.7% y/y). Apparel prices held steady (-3.1% y/y). Increasing by 0.1% (0.9% y/y) were new vehicle prices. Recreation product prices also rose 0.1% (-1.0% y/y) following a 0.3% decline, but video & audio product costs dropped 1.0% (-9.3% y/y). Prices of furniture & bedding rose 0.7% (2.4% y/y), recouping a 0.7% April decline.

Service prices improved 0.2% in April (2.7% y/y), following two months of 0.3% gain. Transportation services prices rose 0.1% (1.1% y/y), but the cost of public transportation surged 1.9% (0.9% y/y). Shelter costs rose 0.2% (3.3% y/y). Rents of primary residences increased 0.2% (3.7% y/y) and the owners' equivalent rent of primary residences gained a steady 0.3% (3.4% y/y). The cost of lodging away from home eased 0.1% (1.6% y/y). Recreation services prices declined 0.5% (+2.2% y/y) and the cost of medical care services rose 0.5% (2.8% y/y). Education & communication service costs increased 0.2% (1.3% y/y) as tuition costs gained 0.3% (3.5% y/y).

Lower energy prices held back the overall gain in the CPI with a 0.6% decline (-0.5% y/y). It followed two months of strong increase. Weakness was led by a 1.0% decline (-2.5% y/y) in natural gas prices and the cost of electricity fell 0.8% (-0.2% y/y). Gasoline prices eased 0.5% (-0.2% y/y) after three months of strong increase. Fuel oil costs weakened 0.3% (-0.8% y/y), after firming for three straight months.

Food prices rebounded 0.3% last month (2.0% y/y) after a 0.1% dip. Nonalcoholic beverage prices gained 1.2% (+2.2% y/y). Meat, poultry & fish prices surged 1.0% (1.4% y/y), but the increase was countered by a 2.2% decline in egg prices (-15.6% y/y). Fruit & vegetable prices fell 0.8% (+1.7% y/y). Dairy prices strengthened 0.7% (1.0% y/y) while cereal & bakery product prices rose 0.4% (2.2% y/y).

The consumer price data can be found in Haver's USECON database with additional detail in CPIDATA. The Action Economics survey figure is in the AS1REPNA database.