The inflation rate in America was unchanged in May at an annualized rate of 3.3%.
The result was below the consensus expectation of economists who had forecast that inflation in the U.S. would rise 3.4% year-over-year during May.
The inflation reading comes hours before the U.S. Federal Reserve is scheduled to announce its latest decision on interest rates.
Futures markets are betting that the central bank will hold its benchmark Federal Funds rate at its current range of 5.25% to 5.50%, its highest level in 23 years.
The Fed Funds rate has been at the same level since July 2023. Markets currently anticipate only one interest rate cut this year, likely in September.
The U.S. central bank targets inflation at an annualized rate of 2%. Consumer prices in the U.S. have remained above 3%, though they have declined from a June 2022 peak of 9.1%.
In May of this year, core inflation that excludes volatile food and energy prices slowed considerably, coming in at an annualized rate of 3.4%.
Economists had forecast May core inflation of 3.5%. In April, core inflation in the U.S. stood at an annualized rate of 3.6%.
U.S. markets rose in pre-market trading on news of the lower-than-expected inflation reading for May, with the blue-chip Dow Jones Industrial Average rising more than 200 points or 0.70%.
