Economists forecast a 4.2 percent year-over-year increase in May CPI, exceeding the Fed’s 2 percent target amid U.S.-Iran tensions and energy pressures.
U.S. consumer prices are expected to rise 4.2 percent year-over-year in May, the fastest pace since April 2023, as energy shocks from U.S.-Iran tensions amplify inflation concerns. The print would mark a sharp acceleration from prior months and exceed the Federal Reserve’s 2 percent target, raising expectations for further rate hikes.
Economists polled ahead of Wednesday’s release anticipate core inflation to remain elevated, reflecting persistent price pressures. The report follows a period of sticky inflation and near four-decade lows in U.S. oil inventories, heightening risks of a prolonged energy-driven spike.
BlackRock warned that the full impact of the Mideast conflict on inflation has yet to materialize, with potential market disruptions depending on developments. Higher borrowing costs could weigh on risk assets, including cryptocurrencies like bitcoin.