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By Kristin Myers, Editor-in-Chief

What's Happening Today

U.S. consumers who were hoping to get some relief from inflation were dealt a blow as inflation rose more than expected. The Bureau of Labor Statistics' Consumer Price Index (CPI) jumped 1% in May from the month before and 8.6% from a year ago, the highest annual rate since December 1981. The news is frustrating, as just about everyone was looking for a decline from April's 8.3% annual inflation rate, or at least nothing worse.

Energy and food prices contributed the most to the increase, with the energy index (gas, oil, and certain utility prices) climbing 3.9% last month after declining in April, and up 34.6% from a year ago. The food index, which includes groceries and eating out, was up 10.1% from a year ago, the first yearly increase above 10% since March 1981.

With the Federal Reserve hiking interest rates to fight rising costs, this latest spike in inflation paves the way for the central bank to be more aggressive with interest rate increases. While this could help bring inflation down, higher interest rates will make it more expensive for consumers to borrow money for homes, cars, and more. Fannie Mae released a survey this week that found a record 79% of respondents think it's a bad time to buy a home, the highest in the survey's 12-year history, and a sign that continued inflation (and the higher rates that may follow) could further increase homebuying pessimism. Americans with credit card debt might also end up paying more on their balances, as credit card rates would also increase.

If you missed yesterday's Instagram Live conversation for Pride Month, you can watch it here. In our talk aimed at the LGBTQ+ community, we chatted with Ellyce Fulmore, financial educator and owner of Queerd Co., about building a financial support system. Make sure to follow The Balance on Instagram so you don't miss out on any exciting conversations in the future!

- Kristin

Editors' Picks

No Relief in Sight as Inflation Heats Up to 8.6% in May (The Balance)

How Inflation Became a Global Problem (The New York Times)

The Price of Gas: Why It Goes Up and Down (The Balance)

US Household Wealth Drops for First Time in 2 Years (Reuters)

Business Losses From Russia Top $59 Billion as Sanctions Hit (The Wall Street Journal)

How Business Renters Insurance Works (The Balance)

More Companies Are Offering an After-Tax 401(k) Option to Big Savers (CNBC)

What Is the Average Income in the United States? (The Balance)

Off the Charts

A record 79% of U.S. consumers polled by Fannie Mae think it's a bad time to buy a house—the most for any month in the 12 years Fannie Mae has been polling. Conversely, a record low 17% of people surveyed said it was a good time to buy.