U.S. CPI Rose More Than Expected in May, Hitting New 40-Year High
2022.06.10 15:56
By Geoffrey Smith
Investing.com — U.S. inflation rose by more than expected again in May, dashing hopes that the rise in the cost of living has peaked.
The consumer price index rose by 1.0% from April, taking the annual headline rate of inflation to a new 40-year high of 8.6%. Analysts had expected the headline rate to stay at 8.3%, with a monthly gain of only 0.7%.
The core inflation rate, which strips out volatile food and energy prices, also rose by more than expected. It rose 0.6% from April, meaning that the annual rate of core inflation only eased to 6.0% from 6.2%.
U.S. stocks and bonds sold off immediately on the news, fearing that the Federal Reserve will have to keep prioritizing the battle of inflation for longer, even if the economy slows as a result.
By 8:38 AM ET (1238 GMT), S&P 500 futures were down 44 points, or 1.0%, having traded roughly unchanged in the minutes before the release. Dow futures shed 200 points, or 0.9%, while Nasdaq 100 futures fell 1.2%.
The yield on the benchmark 2-Year Treasury note, meanwhile, rose by 9 basis points to 2.90%.
