RBC expects U.S. May core CPI to rise 0.3% MoM and to 2.9% YoY, citing ongoing energy-driven inflation and limited relief in food prices after recent beef-led increases. Higher aviation fuel and resilient wage growth amid a tight labor market should sustain core services inflation; core goods inflation is being supported by new and used vehicle price gains, partly masking weakness in apparel, personal care and auto parts. ISM manufacturing and services surveys show sharply rising input costs, an

RBC expects U.S. May core CPI to rise 0.3% MoM and to 2.9% YoY, citing ongoing energy-driven inflation and limited relief in food prices after recent beef-led increases. Higher aviation fuel and resilient wage growth amid a tight labor market should sustain core services inflation; core goods inflation is being supported by new and used vehicle price gains, partly masking weakness in apparel, personal care and auto parts. ISM manufacturing and services surveys show sharply rising input costs, and recent PPI suggests firms retain pricing power; RBC forecasts May headline PPI and core PPI up 0.6% MoM, to 6.3% and 5.5% YoY respectively. NFIB data show the share of firms planning price increases over the next three months near 30%, indicating cost pass-through may continue through the summer and lend further support to inflation in coming months.