NEW: US inflation ticks up to 8,6pc in May despite Fed’s rate hikes

US consumer inflation in May surged 8,6 percent from a year ago, indicating inflation remains elevated despite the Federal Reserve’s rate hikes, the US Labor Department reported Friday.

The consumer price index (CPI) last month rose 1,0 percent from the previous month after increasing 0,3 percent in April, according to the department’s Bureau of Labor Statistics (BLS).

The May CPI surged 8,6 percent from a year earlier, a larger increase compared with the 8,3 percent growth in April, marking the third straight month of inflation over 8 percent. The March figure was 8,5 percent.

The May CPI was the largest 12-month increase since the period ending December 1981. Headline CPI has remained over 6 percent year-on-year since October last year.

Although price growth has started to show signs of easing, the latest data is a stark reminder that the Fed has a long way ahead as it aims to bring elevated inflation under control.

The central bank raised its target federal funds rate by a quarter percentage point from near zero in March, beginning its tightening cycle to curb the surging inflation. In May, the Fed increased the rate by half a percentage point and has signaled more half-point hikes going forward, stoking recession fears.

The so-called core CPI, which excludes food and energy, rose 0,6 percent in May following a 0,6 percent growth the prior month. Core CPI jumped 6 percent over the last 12 months, after climbing 6,2 percent in April.

The increase in prices was broad-based, with the indexes for shelter (which includes rents and homeownership costs), gasoline, and food being the largest contributors, according to the BLS report.

After declining in April, the energy index rose 3,9 percent over the month with the gasoline index rising 4,1 percent. The energy index rose 34,6 percent over the last year, the largest 12-month increase since the period ending September 2005.

The food index, meanwhile, rose 1,2 percent in May as the food at home index increased 1,4 percent. The food index increased 10,1 percent for the 12-months ending May, the first increase over 10 percent since the period ending March 1981. – Xinhua