US inflation rose to 3.8% in April, its fastest pace since May 2023, as energy, food and housing costs climbed amid the war in Iran.
US inflation rose to 3.8% in April, its fastest pace since May 2023, as higher gasoline and grocery prices fed through to consumers amid the war in Iran.
The consumer price index, a broad measure of how much prices have risen over the past 12 months, climbed from 3.3% in March. The increase puts inflation at its highest level since it reached 4% three years ago.
The Bureau of Labor Statistics said nearly half of the monthly rise was driven by surging energy costs. Housing and food prices also contributed, underscoring how the latest inflation pressure is landing in categories that are difficult for households to avoid.
The war involving the US and Israel in Iran, along with the effective closure of the Strait of Hormuz shipping lane, has pushed fuel costs higher. The national average price for a gallon of unleaded gasoline has reached $4.50, its highest level since July 2022, according to AAA.
The April reading could make it harder for the Federal Reserve to cut interest rates this year. The central bank has been watching for evidence that inflation is moving sustainably lower before easing borrowing costs.
The jump also carries political risk for President Donald Trump and Republicans ahead of November’s midterm elections. Trump’s 2024 re-election campaign was built in part around promises to reduce inflation, and the latest figures show prices accelerating again as voters face higher everyday costs.
Beyond energy and groceries, air fares and clothing prices also increased in the year to April. New car prices fell slightly, offering a limited offset to broader price pressures.
The next inflation readings will be closely watched for signs of whether the energy shock is spreading further through the economy or remains concentrated in fuel and related costs.
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