Getting Hotter: What We Learned During the Week of June 8 – 12

Energy prices helped push inflation higher in May. Here are five things we learned from U.S. economic data released during the week ending June 12. 

Consumer prices rose again in May. The Consumer Price Index (CPI) surged by a seasonally adjusted 0.5 percent, following 0.9 percent and 0.6 percent gains in March and April, respectively. The Bureau of Labor Statistics measure has risen 4.2 percent over the past year (its largest year-over-year increase since 2023). Energy prices jumped 3.9 percent (gasoline: +7.0 percent), with energy CPI up 23.5 percent over the past year (gasoline: +40.5 percent). Food prices advanced 0.2 percent. Excluding energy and food, core CPI increased 0.2 percent for the month and 2.9 percent over the past year. Prices rose for medical care services (+0.5 percent), shelter (+0.3 percent), apparel (+0.3 percent), and used cars/trucks (+0.1 percent). Prices declined for medical care commodities (-0.7 percent), transportation services (-0.6 percent), and new vehicles (-0.3 percent). 

…As did wholesale prices. The Producer Price Index (PPI) for final demand rose by a seasonally adjusted 1.1 percent, matching the Bureau of Labor Statistics measure’s April gain. The core wholesale price measure (which removes energy, food, and trade services) jumped 0.8 percent (April: +0.5 percent). Goods PPI swelled 2.8 percent, including a 10.7 percent rise in energy wholesale prices (gasoline: +23.4 percent) and a 0.6 percent gain in food prices. Net of both, core goods PPI surged 0.8 percent. Services PPI was up 0.3 percent, including a 1.1 percent drop for trade services. Over the past year, headline PPI has risen 6.5 percent (highest since November 2022), with the core measure up 5.1 percent (highest since October 2022). 

Home sales saw a modest rebound in May. The National Association of Realtors reports that existing home sales rose 3.2 percent to a seasonally adjusted annualized rate (SAAR) of 4.170 million units. Sales were also up 3.2 percent from a year earlier. Sales improved in three of four Census regions during the month, with no change in the West. Similarly, sales were up year-over-year in three regions, with sales dropping 8.0 percent in the Northeast. Inventories of unsold homes jumped 3.3 percent to 1.550 million units (equivalent to a 4.5-month supply). The median sales price of $429,300 was up 1.3 percent from a year earlier. The press release attributed the sales gain to “improving affordability.” 

The trade deficit narrowed in April. Exports rose 2.6 percent to a seasonally adjusted $327.1 billion, while imports surged 2.0 percent to $383.0 billion. The resulting trade deficit of -$55.9 billion marked a 1.2 percent decline in the Census Bureau/Bureau of Economic Analysis measure. The year-to-date trade deficit of -$222.6 billion was down 49.1 percent from a year earlier. During the month, the goods deficit shrank by $2.4 billion to -$83.7 billion, while the services surplus contracted by $1.7 billion to +27.8 billion. The goods deficit decline reflected increased exports of capital goods (computers, civilian aircraft) and industrial supplies (oil). The U.S. recorded its largest goods deficits with Taiwan, Vietnam, Mexico, and China.  

Consumer sentiment recovered slightly in early June. The University of Michigan’s Index of Consumer Sentiment gained 3.1 points to a seasonally adjusted 48.9 (1966Q1=100). Even with the increase, the index was 19.4 percent below year-ago levels. Both the current and expectations indices improved in early June, with the former up 2.6 points to 48.4 (-25.3 percent versus June 2025) and the latter up 5.2 points to 49.3 (-15.1 percent versus June 2025). The press release attributes the rebound in sentiment to a recent “easing in gasoline prices.” Nevertheless, inflation expectations remain very high, with one-year anticipated inflation at +4.6 percent. 

Other U.S. economic data released over the past week:

• Jobless Claims (Week ending June 6, 2026, First-Time Claims, seasonally adjusted): 229,000 (+4,000 vs. the previous week, -17,000 vs. the same week a year earlier). 4-week moving average: 219,000 (-7.9% vs. the same week a year earlier).
• Small Business Optimism (May 2026, Index (1986=100), seasonally adjusted): 95.3 (April 2026: 95.9; May 2025: 98.8).
• Month Treasury Statement (May 2026, FY2026 Year-to-Date Deficit): -$1.246 trillion (vs. FY2025 year-to-date: -$1.364 trillion).
• Wholesale Trade (April 2026, Merchant Wholesalers’ Inventories, seasonally adjusted): $940.3 billion (+0.6% vs. March 2026; +3.6% vs. April 2025.

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