U.S. inflation hits 4.1 pct in May

NEW YORK, June 25 (Xinhua) -- The U.S. personal consumption expenditures (PCE) price index reached a seasonally adjusted 4.1 percent annual rate in May, the highest since April 2023, according to a U.S. Commerce Department report released on Thursday.

The PCE rose 0.4 percent on a monthly basis, down 0.1 percentage point from market expectations.

The core PCE price index excluding food and energy rose 3.4 percent year on year and 0.3 percent month on month, the highest since October 2023.

Given the increase in energy prices tied to the Middle East conflict, it came as no surprise that energy provided the largest source of price gains, with related goods and service prices up 4 percent in May. Housing costs rose 0.3 percent, while financial services and insurance jumped 1.2 percent.

The Federal Reserve uses the PCE price index as a primary indicator of inflation and the core PCE as a better measure of long-run inflation trends. The rise in indicators has reinforced the central bank's recent tough talk on inflation.

The report came just more than a week after Fed chairman Kevin Warsh stressed the importance of price stability. Enditem