US inflation hit its highest level in three years in May, as the war in the Middle East drove energy prices higher across the country.
But Thursday’s data suggested a broader problem across categories, with core inflation, which excludes volatile food and energy costs, also ticking up last month. Despite rising prices, overall consumer spending in the US remained resilient, thanks to higher tax refunds and surging stock prices, Bloomberg noted.
Still, gas prices remain higher than pre-war levels, and the lingering impact of the conflict on the country’s supply chains is likely to keep prices elevated and maintain pressure on the US Federal Reserve to raise interest rates this year.
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