U.S. Consumer Prices Surge on Gasoline
Inflation has likely peaked
U.S. monthly consumer prices increased by the most in 16-1/2 years in March as Russia's war against Ukraine boosted the cost of gasoline to record highs, cementing the case for a 50 basis points interest rate hike from the Federal Reserve next month.
The acceleration in prices reported by the Labor Department on Tuesday culminated in annual inflation rising at its fastest pace since the end of 1981. But there is cautious hope that the worst of the post-pandemic inflation surge is behind.
Monthly underlying inflation pressures moderated as goods prices, excluding food and energy, dropped by the most in two years. Further declines in the so-called core goods prices are likely as demand shifts back to services amid the rolling back of COVID-19 restrictions on businesses.
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