Key insights
- March inflation surged, driven by rising gas prices, exceeding expectations. The higher-than-anticipated CPI print increases pressure on the Federal Reserve to maintain its hawkish stance, potentially delaying interest rate cuts. This development is bearish for US equities as it raises borrowing costs and dampens economic growth prospects.
Inflation in March saw the largest monthly gain since 2022 as the US-Israel war sent gas prices skyrocketing past $4 a gallon.
Headline inflation clocked in 3.3% higher than a year ago, while rising 0.9% on a monthly basis in a rapid acceleration from February’s levels, according to Labor Department data released Friday. Economists surveyed by Bloomberg had anticipated a 3.4% increase from a year ago and 0.9% from a month prior.