A decline in beef prices last month may have prompted a sigh of relief in the White House Wednesday, while overall inflation continued to run hot, with the consumer price index rising 4.2% year over year – its highest reading in three years.
The overall beef and veal category saw prices post a 1.6% monthly decline in May, leaving prices up 12.9% year over year, the Labor Department said. Breaking down the categories, uncooked ground beef prices fell 1.3%, leaving them up 12.1% from May 2025; uncooked roasts fell 3.6% in May, up 15.3% year over year; and uncooked steaks were down 1.9% for the month, up 14.8% year over year.
News reports said President Donald Trump last month was set to sign an executive order to temporarily reduce import tariffs on beef. The move was headed off after USDA Secretary Brooke Rollins “at the last minute went into the Oval and threw a fit,” Politico reported at the time, citing a White House official.
Stubbornly high beef prices reflect resilient consumer demand and historically tight supplies. They’re also seen as a political liability for Republicans as they attempt to keep control of the House and Senate this fall as consumers grapple with accelerating inflation that has exceeded wage gains. Trump has repeatedly groused about beef prices and vowed to bring them down while also pledging to support the cattle industry.
The May CPI data is overshadowed by the effort to contain New World screwworm (NWS) cases following the confirmation of the pest’s arrival on U.S. soil last week, which has injected uncertainty into the outlook for cattle and beef prices. Cattle futures have been volatile and the long-term impact on beef prices remains unclear, with much depending on how feedlots, packers and, ultimately, consumers respond. USDA and the beef industry have underlined the fact that the NWS poses no risk whatsoever to consumers.
Cattle futures were mixed Wednesday morning, with August live cattle up 47.5 cents at $240.175 and August feeders down $1.25 at $352.90.
On the input side, the CPI data showed gasoline prices up 7% in May, for a rise of 40.5% year over year. The “other motor fuels” category, which includes diesel, was up 0.8% on the month and 56.9% year over year.
On a monthly basis, overall CPI was up 0.5% in May. Both the monthly and year over year figures were in line with the average guess from economists polled by the Wall Street Journal. Core CPI, which excludes volatile food and energy prices, was up 0.2% versus expectations for a 0.3% rise. The core was up 2.9% year over year, matching expectations.
Fed funds futures traders continue to price in a roughly 66% probability of one or more rate hikes by the Federal Reserve before year-end. Economists at Bank of America said they expect the core personal consumption expenditures, or PCE, index for May to remain sticky. Oil prices have retreated from March highs that saw Brent crude trade around $126 a barrel and WTI just shy of $120, though the Strait of Hormuz remains largely closed to tanker traffic.
“Today’s report does little to change the Fed’s on hold position,” the BofA economists wrote. “While they can be encouraged by further evidence that tariffs are rolling out of the data, upside risks from Iran remain and core PCE is not showing much improvement.”