BlackRock warns of energy shock as May CPI is set to show inflation acceleration

BlackRock said it is watching Wednesday’s May U.S. CPI report for early signs that the U.S.-Iran conflict and an energy shock are feeding into already sticky inflation. According to CoinDesk, economists polled by Reuters expect CPI to rise 4.2% year-on-year, the fastest pace since April 2023 and up from 3.8% in April, keeping inflation above the Fed’s 2% target and raising the odds of further rate hikes. BlackRock flagged the risk of a prolonged Strait of Hormuz closure into July, potentially pushing U.S. oil inventories to four-decade lows and worsening inflation pressures.