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In May, monthly inflation was flat for the first time in nearly two years

Prices also increased 3.3% YoY, lower than April’s 3.4% annual bump.
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Francis Scialabba

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The Consumer Price Index (CPI) was flat in May following a 0.3% increase in April, the Bureau of Labor Statistics reported this week, marking the first time in almost two years the CPI was flat month over month.

Prices increased 3.3% year over year, down from the 3.4% annual bump in April. Both the monthly and annual rates were 0.1 percentage points below economists’ predictions.

Food inflation was up 0.1% in May after being flat in April, with food away from home up 0.4% and food at home unchanged. Among the major grocery store indexes, inflation for dairy was down 0.5%, thanks to a 1.3% drop in milk, while nonalcoholic beverages dipped 0.3% monthly. Fruit and vegetable prices were flat, while meats, poultry, fish, and eggs, along with cereals and bakery products, both rose 0.2% monthly.

“Prices are still too high, but today’s report shows welcome progress on lowering inflation,” President Biden said in a statement on Wednesday, noting that, among other efforts to “lower costs for hardworking Americans,” he’s “calling on grocery chains making record profits to lower grocery prices.”

In other retail categories: Apparel prices were up 0.8% annually but down 0.3% from April, personal care products were also down 0.3% monthly but up 1.3% from a year ago, and alcoholic beverages at home were up 1.4% annually and 0.2% monthly.

As inflation showed signs of cooling, retail sales were up last month. The National Retail Federation’s CNBC/NRF Retail Monitor showed that retail sales in May, excluding automobiles and gasoline, rose 1.35% from April (the largest jump in more than a year, NRF president and CEO Matthew Shay noted) and just over 3% year over year. The Commerce Department is set to release its retail sales data for May on June 18.

Retail news that keeps industry pros in the know

Retail Brew delivers the latest retail industry news and insights surrounding marketing, DTC, and e-commerce to keep leaders and decision-makers up to date.