US consumer inflation accelerated again in March 2024, marking a 3.5 per cent increase for the 12 months ended in March, on rising gas prices and stubbornly high shelter costs, according to the latest Consumer Price Index data released Wednesday by the Bureau of Labor Statistics. The latest data shows that some of the progress made on slowing inflation is now stalled, complicating the timeline for rate cuts by the US Federal Reserve.
That’s a jump from February’s 3.2 per cent rate and marks the highest annual gain in the past six months, highlighting that the path to lower inflation remains extremely bumpy, according to a CNN report.
On a monthly basis, prices were unchanged from February’s 0.4 per cent gain. Gas and shelter costs contributed more than half of that monthly increase, according to the BLS. Aside from prices falling in only a couple of categories — used and new cars as well as fuel oil — or remaining flat (grocery store food), prices rose in pretty much every major category last month.
Economists were expecting a 0.3 per cent monthly increase and an annual rate of 3.4 per cent, according to FactSet consensus estimates, CNN reported.
The Federal Reserve has been wanting to see meaningful progress on inflation before it starts cutting rates. Since the headline index can be heavily influenced by highly volatile categories such as food and energy, central bankers often look closely to the “core” index that strips out those categories.
However, core CPI did not slow as expected.
Excluding gas and food prices, categories that tend to be more volatile, core inflation rose 0.4 per cent from the month before, bringing the annual rate to 3.8 per cent, the same as February’s reading.
(With inputs from agencies)
Comments
0 comment