WASHINGTON — U.S. inflation accelerated to its highest level in more than three years in May, driven largely by rising energy costs linked to the conflict involving Iran, the Labor Department reported on Wednesday.
The Consumer Price Index rose 4.2 percent from a year earlier, according to data from the Bureau of Labor Statistics. That marked the first time the annual rate topped 4 percent in three years. On a monthly basis, the index increased 0.5 percent.
Energy prices surged 3.9 percent during the month and more than 23 percent from a year earlier, the department said. Gasoline prices climbed about 40 percent annually, with average prices reaching around $4.60 per gallon in May, data from the U.S. Energy Information Administration showed. Fuel oil prices rose nearly 60 percent year-over-year.
The increases followed disruptions in global oil supplies after the escalation of the conflict involving Iran in late February, which affected shipping through the Strait of Hormuz, officials and analysts said.
"Energy costs remain a significant driver of overall price pressures," said a Labor Department spokesperson in a statement accompanying the release.
Core inflation, which excludes volatile food and energy prices, rose to 2.9 percent annually, the department reported. Food prices also increased, with grocery costs up about 2.7 percent from a year earlier.
The report comes as households face higher costs for fuel and other goods. Economists have noted that the energy shock has complicated the inflation outlook following a period of moderation earlier in the year.
The Federal Reserve has been monitoring the data closely, though officials have not announced immediate policy changes in response to the latest figures. President Donald Trump and administration officials have highlighted efforts to address supply chain issues and energy production.
The conflict's impact on energy markets has been cited as the primary factor in the recent acceleration, with energy contributing about 60 percent of the overall monthly increase, according to analysts reviewing the data.
As of Saturday, further details on June inflation trends were not yet available. The next CPI report is scheduled for mid-July. Authorities continue to track the situation amid ongoing diplomatic efforts related to the Middle East conflict.
