US inflation rose in line with forecasts in May, although so-called “core inflation” came in lower than expected as the effects of President Trump’s tariffs still have yet to significantly boost consumer prices.

The Consumer Price Index rose 2.4% in May from a year earlier, matching economists’ expectations according to the Wall Street Journal.

The number was slightly above April’s reading of 2.3%, the Bureau of Labor Statistics said Wednesday.

Core inflation, which excludes volatile food and energy prices, came in at 2.8%, in line with the previous month and below expectations for a 2.9% rise.

On a month-to-month basis, core inflation was up just 0.1% — well below the 0.3% that had been forecast.

“Wednesday’s weaker-than-expected CPI opens the door to a Fed rate cut in September, since it’s clear that the inflation data continues to move in the right direction even as we deal with tariff uncertainty,” Skyler Weinand, chief investment officer at Regan Capital, said in a note Wednesday.

If tariffs drop to 10% across the board – as proposed in a deal with China that Trump put back in place on Wednesday – overall numbers would still be higher than the US has witnessed in more than 60 years, Weinand added.

Drops in car and apparel prices, which have been expected to show some of the earliest impacts from tariffs, helped drive lower-than-expected readings.

New vehicles decreased 0.3% while used cars and trucks dropped 0.5% from the month before, and the apparel index fell 0.4%. Prices for these goods are heavily influenced by trade.

Energy dipped 1% on a monthly basis as gasoline prices declined.

Eggs decreased 2.7% as rampant outbreaks of avian flu appeared to ease across the country – though the index still remained 41.5% higher than a year ago.

The shelter index, however, rose 0.3% from the month before – or 3.9% versus a year ago – and was the main driver of inflation last month, according to the government.

The Dow Jones Industrial Average ended flat after rising earlier.

The S&P 500 and Nasdaq finished 0.3% and 0.5%, respectively.

The consumer price numbers come as the Federal Reserve has been in wait-and-see mode, hesitant to slash interest rates amid heightened uncertainty due to Trump’s ever-changing trade policies.

Trump, however, continued to pressure Fed Chair Jerome Powell to cut rates in a Truth Social post on Wednesday.

“CPI just out. Great numbers! Fed should lower one full point,” Trump wrote in all capital letters.

“Would pay much less interest on debt coming due. So important!!!”

While consumer prices appeared to escape the tariff war unscathed, experts warned that companies might just be waiting to pass along price hikes until rates are finalized.

“A lot depends on the absorption rate of US companies and foreign suppliers,” Eric Teal, chief investment officer at Comerica Wealth Management, said in a note. 

“We believe that the majority of the tariffs will eventually get passed to the consumer, but companies are cautious at this juncture about passing along the price increase.” 

Central bankers await a report on wholesale prices on Thursday and the Fed’s preferred gauge, the personal consumption expenditures price index, on June 27.