A customer counts his or her money in the register when purchasing an item at the Best Buy Store in Flushing, New York.
Jessica Rinaldi | Reuters
Inflation remained stagnant in May, although the monthly increase was slightly lower than expected. A business sector measurement The Federal Reserve is watching closely.
Prices of major personal consumption expenditure rose 4.7% year-on-year, 0.2 percent lower than the previous month, but are still at the levels last seen in the 1980s. Wall Street expects a 4.8% rating.
On a monthly basis, excluding volatile food and energy prices, it rose 0.3%, slightly lower than the Dow Jones estimate of 0.4%.
However, headline inflation rose to 0.6% for the month, which was much faster than the 0.2% gain in April. It kept inflation at 6.3% year-on-year, the same as in April and slightly lower than 6.6% in March, the highest level since January 1982.
In addition, the report reflects pressures on consumer spending, which account for nearly 70% of all economic activity in the United States.
While personal income rose 0.5% in May, pre-tax or other deductible income or deductible personal income fell 0.1% month-on-year and 3.3% year-on-year, ahead of the 0.4% estimate. Adjusted spending for inflation fell 0.4%, a sharp drop from a 0.3% gain in April, although it rose 2.1% year-on-year.
Commodity inflation rose to 9.6%, while services rose 4.7%, both of which rose 0.1 percent since April.
The personal savings rate rose 0.2 percent to 5.4 percent from the previous month.
Central bank officials are closely monitoring the data to control runway inflation. Central bank policymakers generally watch major inflation more closely because they believe monetary policy is less effective in controlling fluctuations in gas and grocery prices.
However, central bank chairman Jerome Powell said he had been paying close attention to headline numbers in recent days, with gas prices averaging $ 4.86 a gallon.
The consumer price index, which measures a wide range of goods and services and is most closely watched by the public, rose to 8.6% in May, the highest level since late 1981.
In other economic news, the Labor Department said on Thursday that unemployment claims had fallen to 231,000 for the week ended June 25. Although it is 1,000 more than the estimate, it is 2,000 less than the previous period.
Consecutive claims, running a week behind the headline number, totaled 1.33 million, down slightly from the previous week.