The Fed, helmed by Chair Jerome Powell, is expected to hold rates steady this month despite pressure from President Donald Trump to make cuts.

Core inflation, which excludes more volatile energy, food, alcohol and tobacco prices, rose by 3.5% in the year to May.

The annual pace of inflation was unchanged at 1.7 per cent last month as cooling shelter costs helped tame price pressures. The figures showed marginal improvements in some of the Bank of Canada's closely watched price figures — something economists say appears to be a step in the right direction,