Inflation held steady in May, rising 2.4% over the past 12 months, according to the latest Consumer Price Index (CPI), but under the surface, price tags on everyday goods told a more colorful story — from prices dropping lower for eggs to a spike in bananas and a drop in sewing supplies.¹

Read more: U.S. labor market adds 139,000 jobs in May as unemployment holds at 4.2%

What’s up, what’s down

May’s CPI data shows a mixed bag of price movements across food, fuel, travel, and home goods.² Some of the biggest changes were in categories that touch consumers' everyday budgets:

Price drops in May:

• Eggs: down 2.7% in May, but up 41.5% year over year (YOY)

• Airline fares: down 2.7% in May, and down 7.3% YOY

• Gasoline: down 2.6% in May, and down 12% YOY

• Beef roasts and ham: both down 1.8% in May, but up 9.5% and 3.1%, respectively, YOY

• Sewing machines, fabric, and supplies: down 10.5% in May, and down 14.8% YOY

• Smartphones: down 1.6% in May, and down 14.3% YOY

• Admission to sporting events: down 8.6% in May, and down 1.6% YOY

Price increases in May:

• Ice cream: up 2.4% in May, but flat YOY

• Bananas: up 3.3% in May, and up 3.2% YOY

• Major appliances: up 4.3% in May, and 1.5% YOY

• Coffee: up 1.2% in May, and up 11.5% YOY

• Peanut butter: up 3.8% in May, but down 1.5% YOY

• Nursing homes and adult day services: up 1.1% in May, and up 4.9% YOY

• Pet services, include veterinary: up 0.8% in May, and up 4.9% YOY

While overall inflation stayed in check, price moves behind the scenes highlight the uneven pressure on consumer wallets. The core CPI inflation rate of 0.1%, or 2.8% YOY — which excludes food and energy — was slightly lower than the 0.3% for May and 2.9% YOY changes predicted by many analysts.³ Shelter costs, a major driver of core inflation, rose 0.3% for the month, in line with recent trends.⁴

Grocery prices rose 0.3% in May. Egg prices dropped 2.7% for the month but were still 41.5% higher than a year ago. Bananas increased 3.3% in May, while ice cream rose 2.4%. Beef roasts and ham both declined 1.8% over the month. The index for food away from home, including restaurants and full-service meals, rose 0.3%.⁵

Energy prices were mixed. Gasoline prices fell 2.6% in May and are down 12% year over year. The overall energy index decreased 3.5% from a year earlier. Electricity costs rose 0.9% in May and are up 4.5% from May 2024. Fuel oil prices fell 8.6% year over year, while natural gas prices declined 15.3%.⁶

Transportation costs also shifted. Airline fares decreased 2.7% in May and are 7.3% lower than a year earlier. Used car prices fell 0.5% for the month, and new vehicle prices were down 0.3%.⁷

Prices for household goods showed sharp contrasts. Major appliances increased 4.3% in May, while prices for sewing machines, fabric, and supplies dropped 10.5% for the month and 14.8% over the past year.⁸

Read more: Auto debt declines as buyers face crossroads on prices, tariffs

Potential impact of tariffs

Tariff-related uncertainty remains a factor in the inflation outlook. The U.S. has delayed the rollout of a proposed tariff on certain European goods, and a 90-day pause on China tariffs is predicted to create a surge in imports into the U.S. as retailers prepare for back-to-season shopping and the holiday season.⁹

The Organization for Economic Cooperation and Development recently lowered its U.S. GDP growth forecast for 2025 to 1.6% (previously 2.2%), citing potential effects from tariffs, slower immigration, and policy uncertainty.¹⁰