May inflation breakdown: Where are prices rising the fastest?


Inflation hotter than expected in May

FOX Business’ Cheryl Casone breaks down the consumer price index for May.

American households are confronting the steepest inflation in four decades, with rising consumer prices straining workers' budgets and making it increasingly difficult for them to afford everyday necessities.

The Labor Department said Friday that the consumer price index, a broad measure of the price for everyday goods, including gasoline, groceries and rents, rose 8.6% in May from a year ago. Prices jumped 1% in the one-month period from April. Those figures were both higher than the 8.3% headline figure and 0.7% monthly gain forecast by Refinitiv economists. 


It marks the fastest pace of inflation since December 1981. 

So-called core prices, which exclude more volatile measurements of food and energy, climbed 6% from the previous year, also more than the Refinitiv estimate. Core prices rose 0.6% on a monthly basis, suggesting that underlying inflationary pressures remain strong. 

"Inflation surprised to the upside in May, placing more pressure on [Federal Reserve] policymakers," said Curt Long, chief economist at the National Association of Federally-Insured Credit Unions. "Energy was a key contributor, both as a consumer good and as an input in other areas that saw strong growth, like airfares. But price gains were strong across the board." 

Here's a breakdown of where Americans are seeing prices rise the fastest as they wrestle with sticker shock for the first time in a generation: 


Energy prices rose 6.1% in May from the previous month, and are up 34.6% from last year. 

Gasoline, on average, costs 48.7% more than it did one year ago and 7.8% more than it did in April, according to unadjusted Labor Department data. The average price for a gallon of gas was at $4.98 nationwide Friday, according to AAA, the highest on record. That's up from $3.07 one year ago. Until this year, prices had not topped $4 a gallon nationally since 2008.  

The sharp rise in gas prices has become of the most noticeable impacts of scorching hot inflation on Americans' daily lives, because so many people use cars to commute to work. 


"The spike in gasoline led the way, but higher prices were everywhere in May," said Ben Ayers, Nationwide senior economist. 

In all, fuel oil prices jumped 16.9% in May on a monthly basis, pushing the one-year increase to a stunning 106.7%. Natural gas prices also surged in May, climbing 8% in the one-month period from April – the largest increase since October 2005. 


Food prices – another visceral reminder of red-hot inflation – have climbed 10.1% higher over the year and 1.1% over the month, according to unadjusted figures. The largest increases stemmed from different meats, including chicken (up 17.4% annually, the largest increase ever), pork (13.3%), and beef and veal (10.2%). 

Other prices jumping at the grocery store are dairy and related products (11.8%), fruits and vegetables (8.2%), and eggs (32.2%).


Unfortunately for Americans who needed to buy a car in May, the price of both new and used vehicles continued to soar. 

Used car and truck prices, which have been a major component of the inflation increase, are still up 16.1% from the previous year. In more bad news, prices – after briefly declining in April – rose again in May, jumping 0.7% on a monthly basis.

The cost of new vehicles, meanwhile, is up 12.6% from the prior year, largely because semiconductor shortages continue to delay car manufacturing. On a monthly basis, the price of new vehicles jumped 1%, according to the unadjusted Labor Department data.

Rent, appliances and households goods

In another worrisome sign, shelter costs – which account for roughly one-third of the CPI – swelled in May, climbing 0.6%. It marked the fastest one-month gain since 2004. On an annual basis, shelter costs have climbed 5.5%, the fastest since February 1991.

Rising rents are a concerning development because higher housing costs most directly and acutely affect household budgets.

Another data point that measures how much homeowners would pay in equivalent rent if they hadn't bought their home, also jumped 5.1% over the past year.


Travel and transportation

Airline fares have surged as more people begin to travel for vacation and business. Prices soared 16.1 in the one-month period on an unadjusted basis. Airfare costs are up 37.8% over the past year, according to unadjusted data – in part because airlines are passing along the cost of more expensive fuel to consumers.

In total, the cost of public transportation, including mass transit in cities, is up 26.3% over the past year after climbing 11.2% on a monthly basis in April.

"There was nowhere to hide from higher prices in May," Ayers said. "With consumer inflation at another 40-year high, it is clear that inflationary pressure is not fading and may be gathering steam in response to repeated global supply shocks."

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