A report released by the Commerce Department showed a dramatic slowdown in the annual rate of U.S. consumer price growth in the month of May.
The report said the annual rate of consumer price growth slowed to 3.8 percent in May from 4.3 percent in April. The slowdown surprised economists, who had expected growth to accelerate to 4.6 percent.
The annual rate of growth by core consumer prices, which exclude food and energy prices, also slowed to 4.6 percent in May from 4.7 percent in April. Economists had expected the pace of growth to be unchanged.
On a monthly basis, consumer prices inched up by 0.1 percent in May after climbing by 0.4 percent in April, while core consumer prices rose by 0.3 percent in May following a 0.4 percent increase in the previous month.
The readings on consumer price inflation, which are said to be preferred by the Federal Reserve, were included in the Commerce Department's report on personal income and spending.
The report said personal income climbed by 0.4 percent in May after rising by a downwardly revised 0.3 percent in April.
Economists had expected personal income to advance by 0.4 percent, matching the growth originally reported for the previous month.
Disposable personal income, or personal income less personal current taxes, also increased by 0.4 percent in May after rising by 0.3 percent in April.
Meanwhile, the Commerce Department said personal spending inched up by 0.1 percent in May after climbing by a downwardly revised 0.6 percent in April.
Economists had expected personal spending to rise by 0.2 percent compared to the 0.8 percent jump originally reported for the previous month.
Real personal spending, which excludes price changes, was unchanged in May after edging up by 0.2 percent in April.
With income rising more than spending, personal saving as a percentage of disposable personal income climbed to 4.6 percent in May from 4.3 percent in April.
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