Following two months of declines, inflation-adjusted consumer spending rebounded partially in May. Household finances are showing signs of weakness, as disposable income and savings rates reversed their monthslong upward trend.
Month-over-month top-line inflation decreased from April, but core inflation grew at the same level for a third consecutive month.
Although the Federal Reserve decided to pause interest rate increases in June, persistently elevated core inflation will likely bring another rate hike this year.
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