The U.S. consumer price index (CPI) rose 4.2 percent year on year in May, marking its highest level since May 2023, as energy prices remained high, according to data released by the U.S. Bureau of Labor Statistics on Wednesday.
Notably, the energy index for May increased 3.9 percent month on month, accounting for over 60 percent of headline inflation.
Gasoline and fuel oil prices increased 40.5 percent and 58.9 percent year on year, respectively, in May.
The national average price of gasoline reached 4.555 U.S. dollars per gallon on May 20, a 50 percent rise since the Iran conflict started in February, according to data released by the American Automobile Association. The price later eased to 4.151 dollars per gallon on Wednesday.
The core CPI, which excludes volatile food and energy prices, increased 2.9 percent year on year in May.
Statistics show that U.S. headline CPI for May rose 0.5 percent month on month, down from 0.6 percent in April, while core CPI increased 0.2 percent, compared with a 0.4 percent gain in April and below the market consensus forecast of 0.3 percent.
The report arrives at a critical juncture for markets and Federal Reserve policymakers. While the rate-setting Federal Open Market Committee is widely expected to hold interest rates steady at its June 17 meeting, policymakers acknowledged that the inflation surge caused by the Iran conflict will likely delay any rate reduction. The data are likely to reinforce this stance.
Oil prices rose while U.S. stocks traded lower in the morning session on Wednesday after U.S. President Donald Trump posted on Truth Social that Iran has "taken too long to negotiate a deal" and will "have to pay the price."
U.S. May CPI rises to highest level since May 2023
Iran said on Wednesday that 54 seafarers had been killed, 66 injured and seven remained missing in maritime incidents linked to the conflict in the Middle East and related maritime restrictions, according to figures presented at a meeting of the International Maritime Organization (IMO).
Addressing the 76th session of the IMO Technical Cooperation Committee, an Iranian representative said the incidents had affected a total of 360 vessels, including 253 that were sunk or otherwise totally destroyed.
The representative said the conflict and related maritime restrictions had severely affected ships, seafarers, port operations, search and rescue services, emergency response systems, vessel traffic services, communications facilities and maritime safety infrastructure.
According to the figures presented by Iran, 28 seafarers were taken hostage since the end of February, five of whom remain in captivity.
The representative also reported damage to four maritime operations buildings, four vessel traffic service control stations and eight communications relay units, describing them as critical facilities for safe navigation, emergency coordination and maritime traffic management.
In a document submitted to the committee on June 8, Iran said a U.S. measure entitled "U.S. to Blockade Ships Entering or Exiting Iranian Ports," together with related restrictions, had disrupted commercial shipping, port access, voyage planning, navigational safety and the movement of ships and seafarers.
According to a report from British maritime analytics firm Windward published on Wednesday, five Iran-trading liquefied petroleum gas (LPG) carriers recently broke the U.S. blockade on Iranian ports, with four delivering cargoes to India and one to Pakistan.
Since April 13, the U.S. has imposed a naval blockade in the Strait of Hormuz on all ships trying to enter or leave Iranian ports, aiming to exert pressure on the country.
Iranian Foreign Ministry spokesman Esmaeil Baghaei said on May 29 that the so-called U.S. naval blockade was unlawful from the start, and violated a ceasefire agreement and undermined the freedom of international navigation.
Iran reports 54 seafarer deaths, 253 vessels destroyed since conflict with US, Israel begins
