Consumer prices rose 4.2% in May from a year earlier, up from 3.8% in April and the third straight increase.
U.S. consumer prices climbed a sharply again last month as the 10-week war with Iran pushed energy prices higher.
Despite the pullback in sales, home prices continued to rise last month.
It’s the first read on inflation to capture the effects of the Iran war.
Oil prices shot up again because of the war with Iran, tightening their grip on the global economy and sending stock markets sharply lower.
Worries are particularly high about what will happen to the Strait of Hormuz off the coast of Iran, where roughly a fifth of the world’s oil passes.
On a monthly basis, consumer prices rose 0.2% in January from December, while core prices rose 0.3%.
Inflation rose last month as the price of gas, groceries, and airfares jumped, while a measure of layoffs also increased.
Consumer prices rose 2.7% in July from a year earlier.
The Fed also signaled it would cut rates just once in 2026, down from two cuts projected in March.
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