New York: US consumer prices continued to climb strongly in May, surging 5 per cent from a year ago to reach the highest annual inflation rate in nearly 13 years, Wall Street Journal reported.
The Labor Department said May's increase in consumer inflation was the largest since August 2008. The jump followed a 4.2 per cent rise for the year ended in April, WSJ said.
The core price index, which excludes the often-volatile categories of food and energy, rose 3.8 per cent in May from a year before-the largest increase for that reading since June 1992.
Prices for used cars and trucks leapt 7.3 per cent from the previous month, driving one-third of the rise in the overall index. The indexes for furniture, airline fares, and apparel also rose sharply in May, the report said.
On a month-to-month basis, overall prices rose a seasonally adjusted 0.6 per cent and core prices rose 0.7 per cent.
The annual inflation measurements are being boosted by comparisons with figures from last year during Covid-19 lockdowns, when prices plummeted because of collapsing demand for many goods and services. This so called base effect is expected to push up inflation readings significantly in May and June, dwindling into the fall, WSJ said.
US stock benchmarks were rising toward record highs Thursday morning, despite evidence of mounting inflation pressures in America, accelerating at their fastest pace in years, MarketWatch reported.
The climb in stocks and fairly muted response in the bond market to consumer prices implies that investors are harboring the belief that pricing pressures won't be sustained, it added.
US stocks were record bound on Thursday, shaking off a report that showed that cost of living surged in May, driving the pace of inflation to a 13 year high of 5 per cent, as the economy fully reopens from the Covid pandemic.
MarketWatch reported that still investors appeared to take heart in inflation being a short-lived phenomenon, with the current reports on price increases, highlighting so-called base effects, when weaker months of inflation were phased out from yearly measures as time passed, leading to mechanically higher price levels.