In our latest May 2023 US inflation report, many of you will be pleased to know that according to the latest consumer price index (CPI) data, the year-over-year inflation in May 2023 experienced a decrease of 0.9% compared to April.
This is excellent news for many consumers in the U.S. and represents the lowest rate increase since April 2021, when prices started to begin their meteoric rise.
Compared to a year ago, in May 2022, inflation rose by 4%.
The Consumer Price Index (CPI) for the United States in May 2023 stood at 304.127, while it was 292.296 in May 2022.
On the list of things across several categories that have increased over the past year, they include:
- Shelter
- Motor vehicle insurance
- Recreation
- Household furnishings and operations
- New vehicles
On the other hand, there are some real positive signs, as several categories have witnessed some deflation over the past year. They include the following:
- Airline fares
- Car and truck rentals
- Citrus fruits
- Fresh whole milk
- Used cars and trucks
To learn more about the inflation rate in the US, how it is calculated and measured, and the historic inflation rate over the past 20+ years, we have a detailed article that charts the yearly and monthly rates.
Yearly Inflation Increases by Category
The major inflation categories and their 12-month change for May 2023 include the following:
- Food at Home (Groceries): 5.8% increase
- Food Away from Home (Dining Out): 8.3% increase
- Energy: -11.7% decrease
- Commodities (less food and energy commodities): 2.0% increase
- Services (less energy services): 6.6% increase.
These cost of living increases reported by the U.S. Bureau of Labor Statistics (BLS) highlight the year-over-year increase in the CPI.
May 2023 Monthly Inflation Increases
On a monthly basis, the increase/decrease from April 2023 inflation to May 2023 for the one-month period is as follows:
- Food at Home (Groceries): 0.1% increase
- Food Away from Home (Dining Out): 0.5% increase
- Energy Prices: -3.6% decrease
- Commodities (less food and energy commodities): 0.6% increase
- Services (less energy services): 0.4% increase
The graphic below breaks down the May 2023 US inflation rate showing the 12-month increase from May 2022 to May 2023, the one-month inflation rate increase from April 2023 to May 2023, and what the inflation rate was this time last year.
Factors that Drove US Inflation in May 2023
Some of the key factors that drove the increase in the inflation rate for May include:
Shelter: The shelter index was the biggest contributor to the monthly inflation increase, followed shortly by an increase in the index for used cars and trucks.
Food Prices: In May 2023, the food index did increase by 0.2% from the previous month, following a -0.2% decrease in April. Three of the major six grocery store food group indexes also increased over the month. Fruits and vegetables increased by 1.3%, while the other food at home index rose by 0.4%, and non-alcoholic beverages rose by 0.7%.
All Items Less Food and Energy: The index for all items less food and energy saw a steady increase, rising by 0.4% in May 2023, the same as in April and March. The shelter index also increased by 0.6% over the month, and the index for rent rose by 0.5%.
The latest Federal Reserve press release came out at the beginning of June 2023, in which they discuss the ongoing inflation situation whilst providing goals and solutions to combat the current economic hardships.
June 2023 Inflation Rate Update
Foreign USA’s June inflation report will be released on July 12, 2023. This update will publicize the current inflation rate over the previous 12 months, ending in June 2023.
