Inflation reaccelerates to 3.3%
U.S. consumer prices rose 3.3% year‑on‑year in March, with several reports saying energy costs were the main driver of the monthly jump. (gulftoday.ae) Markets and some sell‑side forecasters disagree on the policy response — market‑implied odds pushed near zero for an April cut while Bank of America still models two cuts later in 2026. (finance.yahoo.com)
U.S. inflation sped up in March, with consumer prices rising 3.3% from a year earlier after a sharp jump in gasoline costs. (bls.gov) The Consumer Price Index rose 0.9% in March after a 0.3% increase in February, the Bureau of Labor Statistics said on April 10. The energy index jumped 10.9% on the month, and gasoline surged 21.2%, accounting for nearly three-quarters of the monthly increase in overall prices. (bls.gov) The annual inflation rate climbed from 2.4% in February to 3.3% in March, the highest since April 2024. Excluding food and energy, so-called core inflation rose 0.2% on the month and 2.6% from a year earlier. (bls.gov; cnbc.com) That split left economists arguing over whether March was a one-month energy shock or the start of a broader inflation problem. Shelter rose 0.3% in March, food was unchanged, and several categories including medical care, personal care, and used cars and trucks fell. (bls.gov) The inflation report landed three weeks after the Federal Reserve left its benchmark rate unchanged at 3.5% to 3.75%. In projections released after its March 17-18 meeting, Federal Reserve officials kept a median forecast for one rate cut in 2026. (finance.yahoo.com; federalreserve.gov) Markets moved the other way on the next meeting. An Investing.com tool based on Thirty-Day Federal Funds futures showed a 97.9% probability on April 11 that the Federal Reserve would hold rates at 3.5% to 3.75% on April 29, with only 2.1% odds of a move higher and no cut priced as the main outcome. (investing.com) Bank of America is still sticking with two rate cuts later in 2026. Yahoo Finance reported on April 11 that the bank’s economist Aditya Bhave told clients the Federal Reserve would likely look through supply-driven inflation and focus on weak wage pressure and politics. (finance.yahoo.com) The next scheduled Federal Open Market Committee decision is April 29, according to the Federal Reserve’s 2026 calendar. March’s inflation spike now sets up that meeting as a test of whether policymakers treat higher gasoline prices as a temporary oil shock or a reason to wait longer. (federalreserve.gov; bls.gov)
