NEW YORK, June 13 (Xinhua) -- The U.S. consumer price index (CPI) posted year-on-year growth of 4 percent in May, the lowest level since March 2021, according to data issued by the U.S. Bureau of Labor Statistics on Tuesday.

The headline inflation gauge showed a month-on-month expansion of 0.1 percent in May, lower than forecast consensus of 0.2 percent and April's 0.4 percent.

Energy costs fell 3.6 percent in May in contrast of a 0.6-percent expansion in April, leading to the slowdown in overall inflation.

Still, the core CPI, excluding food and energy items, recorded a 0.4-percent month-on-month growth for the third consecutive month in May.

In particular, the month-on-month growth of heavyweight shelter costs accelerated to 0.6 percent in May from 0.4 percent in April.

"The index for shelter was the largest contributor to the monthly all items increase, followed by an increase in the index for used cars and trucks," said a release by the U.S. Bureau of Labor Statistics.

Though the year-on-year growth of core CPI eased to 5.3 percent in May from 5.5 percent in the previous month, the stubbornness of the core inflation indicator shows the U.S. central bank Federal Reserve may have more work to do in regards to taming inflation.

"The improvement in core inflation has been more gradual than headline ... it's far less impressive than the realized disinflation for headline CPI," said a research note by the Bank of America Global Research on Tuesday.

The details of the report reaffirm its expectation for the Fed to remain on hold at its June meeting, according to the Bank of America Global Research.

The Federal Open Market Committee has around 95 percent probability of pausing rate hikes in its two-day monetary policy meeting which starts Tuesday, according to data from the CME FedWatch Tool on Tuesday morning.

"While our base case is for the Fed to skip a rate hike at this week's meeting, we don't expect the (CPI) data for May to be sufficient to allow the Fed to call a final end to tightening. Nor do we believe the data will justify the recent optimism among equity investors," said a research note by UBS Global Wealth Management on Tuesday.