All eyes on Fed's next move as US inflation jumps to 5% in May

Beating analysts' expectations

Anna Fedorova
clock • 3 min read

US inflation jumped to 5% year-on-year in May from 4.2% in April, beating analysts’ expectations of a 4.7% increase, as the US economy continues its swift recovery from the shock of the pandemic.

Core inflation also increased to 3.8% year-on-year, more than the expected 3.5%, marking the fastest annual rate of increase since June 1992. The surge in core inflation is in part due to the successful vaccine rollout in the US, which has allowed consumers to spend their savings - J.P. Morgan Asset Management estimates that US consumers will have accumulated excess savings amount to a "whopping 12% of GDP" by the middle of the year. Bond markets seemed to shrug off the latest news, with 10-year US treasury yields up only slightly from closing at 1.49% yesterday (9 June) to 1.515% at ...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Investment

Autumn Budget 24: Reeves sets 20% IHT rate on AIM shares

Autumn Budget 24: Reeves sets 20% IHT rate on AIM shares

Chancellor unveils 50% relief

Cristian Angeloni
clock 30 October 2024 • 1 min read
Cash in Conversation: A poll for financial advisers

Cash in Conversation: A poll for financial advisers

Professional Adviser
clock 29 October 2024 • 1 min read
The challenges and opportunities for active managers

The challenges and opportunities for active managers

'We believe good active managers always have a place in a portfolio'

Darius McDermott
clock 29 October 2024 • 5 min read