Consumer price index (CPI)

The net result is that the average American household’s buying power has dwindled by 0.1% over the past year.

Even with the latest decline in inflation, real earnings have stagnated over the past year.

The surprisingly strong CPI numbers mean the Fed is likely to hold interest rates steady at its next meeting in July.

It could be telling us that price increases have peaked.

The consumer price index rose 4.2% in May, driven largely by energy costs that are up about 24% year over year.

With the consumer price index running at 3.8% — and expected to rise further when new data drops Wednesday — purchasing power is eroding.

Inflation is the biggest challenge for 16% of respondents to a survey from the National Federation of Independent Business, the highest share in over a year.

Overall grocery inflation slowed to 1.9% year-over-year, but the picture is uneven. While egg prices are down nearly 45%, tariffs and supply chain pressures are pushing some produce prices higher.

Asking rents dropped more than 1.5% in February, and apartment supply is growing in some major metros. But shelter costs, which make up about a third of the CPI, are still showing a 3% annual increase.

Inflation and job creation are expected to hold steady, but revisions to the 2025 jobs numbers are expected to be large enough to show a net loss for all of last year.