Inflation rate in OECD countries in May amounted to 5.9%

Inflation in the OECD as a whole accelerated to 5.9% in May, up two-tenths from April, driven by energy prices that rose in 24 of the 38 member countries, according to data released by the organisation today.

The year-on-year change in energy prices, which was negative 0.1% in April, turned positive at 2.5% in May, the highest level since February 2023, with growth in 24 of the organisation’s countries, the OECD (Organisation for Economic Co-operation and Development) said in a statement.

OECD core inflation (inflation minus food and energy) remained broadly stable at 6.1% in May, down from 6.2% in April, while food inflation stabilised just below 5.0% for the third month in a row after declining continuously between November 2022 and March 2024.

The largest increase in headline inflation (0.3 percentage points) was recorded in Japan, where energy inflation rose sharply, partly due to the phasing out of utility subsidies. Energy inflation also rose in France.

Annual inflation in the OECD has been at or just below 6.0% since October 2023, and rose in 18 of the 38 OECD countries in May and fell in 13.

Portugal was among 18 of the 38 OECD countries where inflation rose in May, rising by nine-tenths of a percentage point to 3.1%, well above the eurozone average (where it rose by two-tenths of a percentage point to 2.6%).

In Portugal, core inflation, which excludes the most volatile elements of energy and food, also rose (nine-tenths of a percentage point, to 2.7% in May).

In the euro area, annual inflation, measured by the Harmonized Index of Consumer Prices (HICP), rose slightly to 2.6% in May from 2.4% in April, and core inflation rose for the first time since June 2023.

Energy inflation, although increasing, continued to show large differences between Member States.

Food inflation has declined slightly.

In June 2024, according to Eurostat’s flash estimate, annual inflation in the euro area remained broadly stable at 2.5%, with very little change in core and energy inflation compared to May.

In the G20, annual inflation rose slightly to 7.3% in May from 7.1% in April. Global inflation fell in Indonesia but exceeded 270% in Argentina. Brazil recorded its first increase in inflation since September 2023.

Global inflation remained stable in China, Saudi Arabia and South Africa.

Global annual inflation in the G7 countries remained stable at 2.9% in May. Food and core inflation eased slightly, while energy prices fell at a slower year-on-year pace than in April.

In May, Italy continued to record the lowest global inflation among the G7 countries, remaining at 0.8%, with strong and persistent deflation in the energy sector.