Inflation rises 8.6%, the fastest pace in over 40 years
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A key gauge of inflation accelerated by 8.6% from a year earlier in May, the government said on Friday, a big leap from the previous month as costs for food and gasoline continued to surge.
Why it matters: Hot inflation remains a huge challenge for the Biden administration and the Federal Reserve as they deal with price shocks not seen since the 1980s that are squeezing consumers and souring their view of the economy.
Details: The Consumer Price Index rose 1% last month. Prices rose 0.3% in April, or 8.3% from a year earlier.
- Core inflation, which strips out volatile energy and food items, rose 0.6%, the same pace as April.
The backdrop: The Federal Reserve is watching for clues as price pressures are easing (though CPI is not the central bank's preferred gauge of inflation). It comes as the Fed embarks on a series of aggressive interest rate hikes to help tamp down inflation.
The bottom line: Higher prices showed few signs of relief last month, as America braces for a long stretch of elevated costs.
Go deeper: Scorching hot inflation amplifies recession fears
