US Edition
Key Inflation Gauge Jumps to Highest Level in 3 Years as Iran War Spikes Gas Prices
Gas prices rose nearly 21% in March, pushing the Fed’s preferred measure to its highest annual pace since May 2023, economists said.
- On Thursday, the Commerce Department reported the Federal Reserve's preferred PCE price index rose 3.5% annually in March, marking the fastest annual pace in nearly three years driven by a sharp hike in energy prices.
- Gas prices jumped nearly 21% in March as the Iran War, now entering its ninth week, disrupted shipping in the Persian Gulf and the Strait of Hormuz, choking off a vital waterway for oil trade.
- During a Wednesday news conference, Fed Chair Jerome Powell acknowledged "people are experiencing higher gas prices all over the country now," while core inflation excluding food and energy rose 0.3% from February and 3.2% annually.
- The Federal Reserve has maintained key short-term interest rates after cutting them three times last year, while consumer spending soared 0.9% in March but rose just 0.2% when adjusted for inflation.
- High energy costs push inflation further from the Federal Reserve's 2% target using the PCE Price Index, complicating future policy decisions as the central bank typically keeps rates elevated to combat rising costs.
87 Articles
87 Articles
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Inflation hits nearly 3-year high as gas prices spike 21% in one month
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Fed’s preferred inflation gauge hits 3-year high as gas prices spiked on Iran war
US inflation accelerated in March as the Iran war raised gasoline prices, bolstering financial market expectations that the Federal Reserve could keep interest rates unchanged well into next year.
Inflation Spikes To 3.5 percent in March as War in Iran Continues
Prices grew at a far more rapid rate in March as the war in Iran drove a significant increase in inflation, according to data released Thursday by the Commerce Department. The annual inflation rate in March rose to 3.5 percent, as measured by the personal consumption expenditures (PCE) price index, up from 2.8 percent in […]
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