US inflation accelerated to 4.2% in May, the highest since April 2023, driven by the Iran war energy shock. - Energy prices accounted for over 60% of the monthly CPI increase, with gasoline up 40.5% year-over-year.
- Food prices rose 2.7%, with tomatoes surging 32% and coffee up 17.5%. - Core inflation (excluding food and energy) edged up to 2.9%.
- The Federal Reserve is expected to hold rates steady at its June 17 meeting, but some analysts warn a rate hike may be needed if inflation persists.