US consumer prices rose 5% in May from the same month a year ago, higher than a projected 4.7%, said the US Labor Department on Thursday.
The Consumer Price Index (CPI), which measures changes in the price of goods and services from a consumer perspective, marked its largest 12-month increase since a 5.4% rise for the period ending in August 2008, it added.
In April, CPI rose 4.2% from the same month a year ago.
On a monthly basis, CPI was up 0.6% in May from the previous month, while it gained 0.8% in April. This was also higher than the market estimate of a 0.4% increase.
The energy index rose 28.5% over the past 12 months, it said, adding: "The gasoline index rose 56.2% since May 2020, when it was at its lowest level since February 2016."
Core consumer prices, which exclude food and energy, rose 3.8% in May from the same period last year, and they were up 0.7% from April.
The CPI data is being closely watched by the Federal Reserve for inflation before its two-day meeting set for June 15-16. The central bank next Wednesday will release its projections for economic growth, inflation, and unemployment, and it may signal when it could raise interest rates.
Although Fed Chair Jerome Powell has repeatedly said the bank will allow inflation to climb above the target of 2% for some time until full economic recovery, his remarks will be watched closely to see whether a rate hike may come before 2023.