Retail prices inched up again in May, while a closely watched measure of inflation by the U.S. Federal Reserve remains slightly above a level that sets the stage for an interest rate hike later this year.

A Labor Department report released June 16 shows the Consumer Price Index rose 0.2% from the month before, less than a consensus estimate from analysts. That's up 1% year-over-year.

Energy prices rose 1.2%, reflecting a 2.3% rise in gasoline prices, according to RBC Economics. Food prices provided some offset to the monthly gain in energy prices, slipping 0.2% lower on a month-over-month basis from April.

So-called “core prices,” which omit volatile food and energy prices, advanced 0.2% in May from a month earlier, matching expectations, and are up 2.2% from a year ago following a 2.1% gain in April.

Falling energy prices, on a year-over-year basis, continue to weigh on annual CPI growth. However, absent another significant pull-back in oil prices, that drag will begin to ease more significantly toward the end of this year, according to Nathan Janzen, senior economist at RBC, who also noted food price growth has been weak.

“Outside of those factors, core price inflation has remained relatively solid, with the May year-over-year rate marking a seventh consecutive month of core inflation growth at or above the Fed’s 2% inflation objective,” he said.

Despite the core CPI being above the Fed’s inflation target, this so far has still been not enough for another hike in interest rates.

On Wednesday the central bank announced it was leaving interest rates unchanged. Fed Chair Janet Yellen reiterated the lingering “uncertainties” surrounding the outlook for the U.S. economy and the somewhat “unexpected” weakness in recent data, including  employment numbers that showed a weak number of job additions in May. She also cited a vote next week by Britain on whether or not to exit the European Union, nicknamed the “Brexit.”

Going forward, however, don’t be surprised if the Fed talks up another hike in interest rates, according to Stifel Fixed Income Chief Economist Lindsey Piegza.

“Should we bypass a Brexit and U.S. [economic] data rebounds markedly, get ready for another round of hawkish rhetoric. But would the market have faith in a renewed pledge by the Fed’s Open Market Committee to hike rates sooner than later?” she asks.

According to Piegza, if we learned anything from “the April to June bait and switch” (when committee members moved from leaning heavily toward a summer interest rate hike to backing off in less than three months), “it is that policymakers' comments have a limited shelf life and in no way represent a commitment to act on said comments at the next FOMC meeting.

“In other words, imagine the Fed as a small boy in overalls. He hears a rustle in the woods but before waiting for confirmation he yells ‘wolf!’ at the top of his lungs with his finger on the trigger. Later, he realizes the commotion was caused by a stray llama, not quite what he expected,” Piegza said. "Meaning, the Fed can only yell ‘strong economy’ so many times without taking action before the market stops listening entirely.”