Inflation accelerated for a third-straight month in May amid a stalemate in negotiations to end a war with Iran that has pushed up energy prices, adding to the burden on already strained consumers.
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| NY Times: "Inflation Accelerates to Fastest Pace in 3 Years as Energy Prices Bite" |
The increase has been driven almost entirely by energy prices, which are up 23.5 percent from this time a year ago. Americans have felt that effect most acutely while filling up their vehicles: A gallon of gasoline costs $4.24 on average, according to AAA, up more than a dollar from a year ago.
Faster price gains have wiped out the pay increases Americans have received over the past year, on average. Adjusted for inflation, hourly earnings have fallen 0.7 percent over the past year and are exactly where they were when President Trump returned to office. Tax refunds that came in the spring have been spent, and reductions to the federal Supplemental Nutrition Assistance Program are now cutting into food budgets.
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