U.S. consumer prices increased less than expected in May as cheaper gasoline partially offset higher housing costs, but inflation is expected to accelerate in the coming months on the back of the Trump administration's import tariffs.

NEW YORK (Reuters) -U.S. inflation was benign in April, with retailers likely still selling inventory accumulated before the tariffs. The Personal Consumption Expenditures (PCE) Price Index rose 0.1% last month after being unchanged in March, data showed.

Consumer spending, which accounts for more than two-thirds of economic activity, rose 0.2% last month after an unrevised 0.7% jump in March, the Commerce Department's Bureau of Economic Analysis said on Friday. Economists polled by Reuters had forecast consumer spending climbing 0.2%.

US Inflation data is out and now all eyes are on whether the Federal Reserve go for big interest rate cut or not.

Currently, gold is trading near the upper half of the channel. It has pulled back slightly after hitting resistance around the $3,400 level. The top of the channel lies near the $3,500 mark, which represents the next significant level of resistance.

The Consumer Price Index rose 2.4 percent in May, from a year earlier, a reading that reflects only the initial impact of President Trump’s tariffs.

A key U.S. inflation gauge slowed last month as President Donald Trump's tariffs have yet to noticeably push up prices. Spending by Americans slowed despite rising incomes, potentially an early reaction to higher prices on some imported goods.

U.S. inflation was benign in April, with retailers likely still selling inventory accumulated before the tariffs. The Personal Consumption Expenditures (PCE) Price Index rose 0.1% last month after being unchanged in March,