Inflation in the U.S. rose at an annualized rate of 2.6% in May, matching the expectations of economists and markets.
The data showed that inflation in the U.S. during May slowed to its lowest annual rate of increase in more than three years.
The latest inflation reading for America comes from the Personal Consumption Expenditures (PCE) price index that’s released by the U.S. Commerce Department.
The PCE data is the preferred inflation measure of the U.S. Federal Reserve and influences the central bank’s decision on interest rates.
The May PCE showed that inflation in the U.S. rose only 0.1% from the previous month of April.
The 2.6% annualized rate of increase in May was down 0.2 percentage points from April, said the U.S. Commerce Department.
Both inflation numbers were in line with the consensus views of economists polled by Dow Jones Newswires.
May marked the lowest annual increase in U.S. inflation since March 2021, which was the first time in recent years that inflation topped the Federal Reserve’s 2% annualized target.
Futures traders widely expect the U.S. central bank to cut interest rates in September of this year, lowering the benchmark federal funds rate from its current range of 5.25% to 5.50%.