Balancing a household budget became trickier this spring as rising gasoline prices boosted Southern California inflation to its 2026 high.
My trusty spreadsheet reviewed May’s Consumer Price Index report, averaging results for local regions – Los Angeles and Orange counties, the Inland Empire, and San Diego – and comparing local cost-of-living swings to national trends.
Southern California prices rose at a 3.6% annual rate in May, based on a two-month average of the three local indexes. That’s the fastest local cost-of-living climb since December 2025, and up from 3.1% a year ago.
Still, for a longer-term perspective, local inflation is running below the 3.9% average we’ve seen since 2019.
Across the country, inflation is even hotter. Prices grew at a 4.2% annual pace in May, up from just 2.4% a year ago. It’s also the fastest pace in three years and above the 3.7% average since 2019.
Shrinking pay raises make this revived inflation especially bothersome to consumers. Wages in the first quarter rose only 3.1% annually across Southern California – and 3.4% nationally, according to a federal employer cost index.
Pain at the pump
Blame gasoline for most of the latest inflation pain. Prices at the pump skyrocketed as the war in Iran sent crude oil costs soaring.
Locally, gas prices are up 27% over the past year, the biggest increase since October 2022. This is a big change from a year ago, when prices were falling by 9%. Since 2019, Southern California’s gas prices have risen an average 6% each year.
Nationally, gasoline’s up 41% in the year through May – a switch from a 12% drop a year ago and well above the 5.3% average rate since 2019.
Food fight
Your supermarket run is adding to your inflation headache, too.
Southern California’s grocery prices jumped 2.5% over the past year, the largest increase since September 2025. This is higher than the 1.9% rise a year ago, but still less than the 4% average since 2019.
Nationally, the “food at home” index is 2.7% higher in the year through May. That’s up from 2.2% a year ago, but lower than the 3.9% average since 2019.
Housing help
The good news is a slower rise in the cost of keeping a roof over one’s head.
According to the CPI, Southern California’s housing inflation is at its lowest since August 2021. The 2.9% increase in the year ending in May is off from 3.9% a year ago and below the 4.4% average since 2019.
What’s behind housing’s chill? Economic uncertainty and an uptick in local residential construction pushed landlords to cut rents while home prices were throttled.
Nationally, housing costs are up 3.6% in the year through May. That’s down from 4% a year ago and below the 4.3% average rate since 2019.
Minus food, energy
Some economists will tell you inflation is cooling.
Their main argument? They look at a version of the CPI that leaves out food and energy costs.
Who can live without food and energy? That’s why many folks are skeptical of economic analysts these days.
Contemplate that this so-called “core” inflation in Southern California was rising at a 2.5% annual rate in May. This represents its slowest pace since April 2021. It’s also down from 3.6% a year ago and a 3.7% average since 2019.
Nationally, core inflation is up 2.9% through May. That’s a smidge higher than 2.8% a year ago, but still below the 3.5% average since 2019.
Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com
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