Overview
- The U.S. Bureau of Labor Statistics reported on Wednesday that the Consumer Price Index rose 4.2% year‑on‑year in May, the biggest annual increase since April 2023.
- Energy costs were the main driver of the May jump, with gasoline and fuel prices rising sharply after renewed U.S. strikes on Iranian targets and Iran’s restrictions on traffic through the Strait of Hormuz.
- Global oil climbed toward about $92 a barrel as market data showed U.S. crude stocks fell for an eighth straight week, increasing concern that strategic buffers could reach multi‑decade lows if disruptions persist.
- Financial markets reacted with a tech‑led equity selloff, safe‑haven flows and higher bond yields as investors priced a greater chance of interest‑rate hikes later this year.
- China’s May export boost reflects front‑loaded orders for chips and AI parts that may fade, and asset managers warn that a prolonged Strait of Hormuz closure into July would deepen the energy shock and add further inflation risk.