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On a seasonally-adjusted basis, overall consumer prices increased 0.1 percent in May. In response, NAFCU Chief Economist and Vice President of Research Curt Long said the association "expects that the combination of weak inflation, slowing economic growth, and ongoing trade risks will prompt a rate cut in the third quarter."

"Inflation rates hardly budged in May," said Long in a new NAFCU Macro Data Flash report. "Cheaper gasoline prices kept readings low. Even after stripping out energy and food, core prices advanced just 0.1 percent in each of the past four months. Some Federal Reserve officials believe inflation is being dragged down by outliers, chief among them used vehicle prices, which sank 1.4 percent last month. If that view is correct, inflation should snap back on its own. But the shortfall in inflation has been so persistent that NAFCU believes it unlikely that price pressures will accumlate over the near term."

According to data published Wednesday by the Bureau of Labor Statistics, the overall CPI grew 1.8 percent over the 12-month period.

Core prices (excluding food and energy costs) increased 0.1 percent in May compared to the previous month. Year-over-year core CPI growth was 2 percent.

Energy prices decreased 0.6 percent in May following a 2.9 percent increase in April. From a year ago, energy prices were down 0.5 percent. Food prices rose 0.3 percent in May. On a year-over-year basis, food prices were up 2 percent.

For more data from Long and NAFCU's research team, click here.