YouThe Federal Reserve is expected to keep raising interest rates aggressively until longer, as nflation soared to a 40-year record in May.
Labor Department data on Friday showed that the consumer price index rose 8.6% compared to a year ago. Inflation, which is closely followed by the public, rose 1.1% from one month ago. This was higher than all other estimates. These were the biggest contributors.
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The core CPI is a measure that excludes more volatile components of food and energy. It rose 0.6% from the month before and 6% from the year prior, both above predictions.
The figures reinforce that inflation is still heated by many measures, and that the Fed — which has committed to half-point hikes at each of its next two meetings, starting next week — will have to maintain that aggressive stance through its September gathering. Inflation will continue to rise due to record gasoline prices and other geopolitical factors. The Fed must therefore keep the economy in check for longer.
Treasury yields increased, stock futures declined and the dollar rose following the report.
—With assistance from Sydney Maki, Reade Pickert, Augusta Saraiva, Chris Middleton and Sophie Caronello.
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