The U.S. consumer price in May rose at a slowest pace in more than two years, adding to the probability for the Federal Reserve to maintain interest rates at the two-day meeting, starting Tuesday.
Consumer Price Index for May rose 4.0% from the same period of last year, the smallest increase since March 2021 and after a 4.9% rise in April.
Inflation rose 0.1% on a monthly basis after an increase by 0.4% in April. Gasoline prices dropped 5.6%, while electricity declined for a third straight month. However, food prices increased 0.2%.
According to CME FedWatch Tool, the odds for the U.S. central bank to skip rate hikes this week was around 70% prior to the inflation report. The probability for a pause is now rising to 95% after the market saw that inflation has slowed down.
