Consumer prices rose a little more than expected, says a highly anticipated report on consumer prices by the Department of Labor released in May.

The Labor Department said its consumer price index rose 0.7 percent in May following a 0.4 percent increase in the previous month. Experts had been expecting a lower increase - nearly 0.6 percent.

The higher than expected increase marks the fastest pace of consumer price growth since September of 2005, when the impact of Hurricane Katrina drove gasoline prices higher and resulted in a 1.2 percent increase in consumer prices.

A sharp rise in energy prices also contributed to the bigger than expected increase in prices in May, with energy prices surging up 5.4 percent after rising 2.4 percent in April. The increase in energy prices was due in large part to a 10.5 percent increase in gasoline prices.

The increase in energy prices also contributed to a significant increase in transportation prices, which rose 2.8 percent in May following a 1.2 percent increase in April.

However, the report showed that the core consumer price index, which excludes food and energy prices, edged up only 0.1 percent after rising 0.2 percent in April, which is in line with expectations.