Consumer Price Index Jumps Again In May As Inflation Concerns Grow

The debate over how concerning the rise in inflation should be rages on.

The U.S. Bureau of Labor Statistics' consumer price index rose by 0.6% from April to May, representing a 5% increase compared to May 2020, according to the official BLS announcement released Thursday morning. Ahead of that announcement, the White House attempted to quell concerns, highlighting a column written for BloombergQuint by former Office of Management and Budget Director Peter Orszag giving only a 7% chance that inflation will remain high next year, Axios reports.

The 5% year-over-year increase is the most since the 12-month period ending August 2008, BLS reports. It also is a reflection of how poorly the economy was performing in May of last year, when lockdowns were still the norm across the U.S. and beyond. The White House also pointed to projections from Goldman Sachs that the inflation pickup is temporary, Axios reports.

Still, former high-ranking economic officials like former Treasury Secretary Larry Summers and former Council of Economic Advisers Chair Jason Furman are raising the alarm that inflation at or above 3% could persist without intervention, Axios reports.

Treasury Secretary Janet Yellen acknowledged over the weekend that inflation could hit 3% on a "year-over-year" basis but that such an increase will prove "transitory," The Washington Post reports. The Federal Reserve generally seeks to keep inflation in the 2% range, but Fed Chair Jerome Powell has not wavered from his stance against raising interest rates until the labor market improves further, Reuters reports.

The biggest factor driving the rise in the CPI was used cars, which have increased in price by about 30% year-over-year. In May, used cars rose 7.3% in price from April, which had already increased 10% from March, according to BLS statistics. Used cars alone drove a third of the overall CPI increase, BLS stated in its announcement.

The longer that inflation remains elevated and threatens to go higher, the more it will affect the commercial real estate market. Some, including JLL Chief Economist Ryan Severinopredict that high inflation could translate to high-powered investors looking to commercial real estate as a place to park money and protect it from inflation's worst effects.

Continue reading this story with a free account

Log in or register
Sign up for more articles like this
Subscribe to Bisnow's National Newsletters
Related Stories

Inside The Nationwide Jockeying For Opportunity Zones 2.0

GTIS Partners Rebrands As Brightshore Capital, Launches $250M Debt Platform

Data Center Spills 5,000 Gallons Of Fuel Into New Jersey River

Hines And Rialto Close Office Credit Fund At $1.1B

Chipotle Adding Hundreds Of New Locations Worldwide

'Beyond A Routine Wobble': 10-Year Treasury Clears 5% Ahead Of Key Fed Meeting

Trump's DEI Crackdown Is Creating New Risks For Landlords That Lease To The Government

Airbnb Launches $250M Fund To Invest In Affordable Housing

Brookfield Buys Minority Stake In Hyperscale Data Center Developer AREP

Judge Dismisses Suit Alleging Alexandria Misled Investors Over Portfolio Strength

How Companies Can Eliminate Shadow AI And Gain Value From Artificial Intelligence Tools

Canadian CRE Investors Shrug Off Trade War, Spend $9B On U.S. Assets