Dow Jones Securities: U.S. May CPI expected to cool down but still high, limited downward space for core inflation within the year.

According to TD Securities, the upcoming U.S. CPI report for May is expected to confirm that inflation is slowing down but still stubbornly high. The institution predicts that the core CPI for May will decrease to 0.23% on a monthly basis and remain stable at 2.8% annually; while the overall CPI will drop to 0.4% on a monthly basis and rise to 4.2% annually. Looking at the breakdown, it is expected that in May, commodity prices will increase by 0.13% compared to the previous month, in line with the three-month average. Most of the increase is attributed to core commodities excluding cars, with categories such as household goods and clothing showing an increase. The expected further decrease in the prices of used cars will partially offset this increase. In addition, it is anticipated that the continued transmission of oil price shocks and tariff impacts will push core inflation to around 3.0% year-on-year in June, with upside risk if aviation fuel costs transmit to ticket prices beyond expectations. Looking ahead to the second half of 2026, it is predicted that core inflation will not see a meaningful decrease. Core commodity prices, excluding cars, will continue to show strength, while housing costs will tend to normalize at a high level.