Consumer prices increased quickly in May, in the latest sign that inflation is finally rising to normal levels after three years of disinflation and efforts by the Federal Reserve to ease the money supply and expand credit to reverse the trend.
The Consumer Price Index rose to 2.1 percent for the year ending in May, the Bureau of Labor Statistics reported Tuesday morning. Prices increased 0.4 percent during the month, adjusting for seasonal variation, twice as fast as analysts expected.
While the increase in prices was led by the rising costs of food, electricity and gasoline, the gains were broad-based. Core inflation, a less volatile index of price changes that strips out food and energy costs, was up 1.8 percent for the year. The 0.3 percent increase of seasonally adjusted core prices in May was the largest since August 2011.