US inflation surges to highest reading in March on Middle East energy crisis
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The news: US inflation surged by the most in nearly four years during March, as the war in Iran saw petrol price surge and the fallout of the Middle East war rippled across the US economy.
The numbers: The US consumer price index rose 0.9% from February, surging to 3.3% from 12 months prior, its strongest pace since 2024.
The reading is in line with expectations surveyed by the Wall Street Journal.
Core CPI, which strips out volatile food and energy categories, rose 2.6%, slightly below forecasts of a 2.7% increase.
Energy prices drove the sharp CPI uptick, jumping 12.5% from one year earlier and a strong acceleration from the 0.5% monthly increase in February.
Prices for fuel swelled 18.9% while fuel oil surged by 44.2% from 12 months prior.
The context: The figures, released by the Bureau of Labor Statistics on Friday, showed that the record increase in petrol prices was responsible for almost three quarters of the March advance, underscoring the rapid impact the war in Iran is taking on the US economy.
Economists have warned that even with a rapid resolution with a ceasefire holding, higher energy costs are likely to persist in the near term.
The sources: US Bureau of Labor Statistics, WSJ
