May 2025 Inflation Update: Consumer Prices Rise Less Than Expected

the staff of the Ridgewood blog

WASHINGTON DC, the Consumer Price Index for All Urban Consumers (CPI-U) rose a less than expected,  0.1% in May, following a 0.2% increase in April, according to the U.S. Bureau of Labor Statistics. The report signals a continued cooling of inflation, with annual consumer price growth now at 2.4%, just above the Federal Reserve’s 2% target.

📈 Key Inflation Highlights – May 2025

• Monthly CPI Increase: +0.1% (seasonally adjusted)

• Annual CPI Increase: +2.4% (unadjusted)

• Core CPI (excluding food & energy): +0.1% in May | +2.8% YoY

• Energy Index: -1.0% in May | -3.5% YoY

• Food Index: +0.3% in May | +2.9% YoY

🏠 Shelter and Food Lead the Rise in Prices

The shelter index—which includes rent and owner-equivalent rent—rose 0.3% in May, continuing to be the dominant driver of monthly price increases. Shelter costs have remained sticky even as other categories cool, keeping upward pressure on core inflation.

The food index also climbed 0.3%, with both grocery prices (food at home) and restaurant prices (food away from home) contributing equally to the rise.

⛽ Energy Prices Continue to Fall

Consumers saw some relief at the pump in May, as the energy index dropped 1.0%, driven by a decline in gasoline prices. On a year-over-year basis, the energy category is down 3.5%, softening the impact of rising costs in other sectors.

🛍️ Mixed Results in Other Spending Categories

While the overall core inflation rate (excluding volatile food and energy costs) rose only 0.1%, several specific indexes recorded changes:

Increased in May:

• Medical care

• Motor vehicle insurance

• Household furnishings and operations

• Personal care

• Education

Decreased in May:

• Airline fares

• Used cars and trucks

• New vehicles

• Apparel

💡 What It Means

The slight increase in the CPI for May, alongside cooling energy prices and only modest gains in core inflation, suggests that inflationary pressures are stabilizing. This data will be closely watched by the Federal Reserve as it determines whether to hold or lower interest rates in the coming months.

While essentials like shelter and food remain expensive, declines in energy and goods prices are helping to moderate overall inflation levels. Consumers may feel a mixed impact—continued strain on housing and insurance costs, but relief in fuel, travel, and some durable goods.

Follow the Ridgewood blog has a brand-new new X account, we tweet good sh$t
https://twitter.com/TRBNJNews
https://truthsocial.com/@theridgewoodblog
https://mewe.com/jamesfoytlin.74/posts
#news #follow #media #trending #viral #newsupdate #currentaffairs #BergenCountyNews #NJBreakingNews #NJHeadlines #NJTopStories