The pace of inflation slowed in May but remains far higher than the Federal Reserve’s two percent target.
The personal consumption expenditure price index, which measures the goods and services purchased by U.S. households, rose 3.8 percent compared with a year ago. That is down from the 4.4 percent reported in April.
Compared with the prior month, the index was up 0.1 percent, down from the extremely hot 0.4 percent pace in April.
The decline of energy goods and services prices drove the slowdown. Energy prices were down 3.9 percent in May compared with April. They rose 0.7 percent in April but were down in each of the prior two months.
Food prices rose 0.1 percent compared with April after being flat the month before.
Excluding food and energy prices—a measure often referred to as “Core PCE inflation”—prices were up 0.3 percent for the month and 4.6 percent over…