In May, headline inflation rose slower relative to April, while core inflation remained unchanged.
On a seasonally adjusted basis, the Consumer Price Index (CPI), released by the Bureau of Labor Statistics (BLS), rose by 0.1% in May, after a 0.3% increase in April. It was the smallest gain since January 2019. Excluding the volatile food and energy components, the “core” CPI increased by 0.1% in May for the fourth straight month.
The food index rose by 0.3% in May, after declining 0.1% in April. Meanwhile, the price index for a broad set of energy sources decreased by 0.6% in May, after a 2.9% increase in April. Monthly changes in energy prices and overall inflation moved in the same direction as core inflation remained unchanged in May.
Over the past twelve months, on a not seasonally adjusted basis, the CPI rose by 1.8% in May, slower than a 2.0% increase in April. Meanwhile, the “core” CPI increased by 2.0% over the past twelve months, after rising 2.1% in April.
NAHB constructs a “real” rent index to indicate whether inflation in rents is faster or slower than overall inflation. It provides insight into the supply and demand conditions for rental housing. When inflation in rents is rising faster (slower) than overall inflation, the real rent index rises (declines). The real rent index is calculated by dividing the price index for rent by the core CPI (to exclude the volatile food and energy components).
The Real Rent Index rose by 0.1% in May, after rising 0.3% in April. Over the first five months of 2019, the monthly growth rate of the Real Rent Index was 0.2%, on average, higher than the average of 0.1% in 2018.