WASHINGTON–Thanks largely to lower gas prices, the Consumer Price Index in May rose 2.4% on an annual basis, lower than many had expected and indicating the effects of President Trump’s tariffs have not yet hit Americans on everyday items.

The CPI rose 2.5% last month on an annual basis, an increase from April’s 2.3% rate. 

So-called core inflation, or CPI data that excludes volatile food and energy prices, rose by 2.8% over the past 12 months, the Bureau of Labor Statistics said in releasing the data. 

“Inflation surprised to the downside again in May,” said Curt Long, chief economist with America’s Credit Unions. “Tariff impacts were nowhere to be seen as categories like apparel and used vehicles saw price declines during the month. The FOMC wants to see how tariffs will play out before acting, but the steady progression of low inflation readings combined with modest deceleration in the labor market means that pressure is mounting to ease rates. 

“As consumers face an uncertain outlook, credit unions remain a stalwart financial partner, providing low-cost financial services to Main Street,” Long added. 

Foot Off the Gas

Lower energy prices were a significant reason for the disinflationary pressures. Gasoline prices dropped 12% in May from a year earlier, according to the CPI data.  

Other items that declined in price included clothing, which was down by 0.9% from a year earlier, and airline fares, with a 7.3% decline. Increases were seen in many grocery items, including beef and coffee, as well as housing costs.