Tariffs show up in CPI

U.S. consumer prices rose 0.9% in March, and gasoline drove most of the jump. (bls.gov) The Bureau of Labor Statistics said the energy index climbed 10.9% in March and gasoline prices jumped 21.2% in a single month. Gasoline alone accounted for nearly three quarters of the overall increase in the Consumer Price Index. (bls.gov) Core inflation stayed much lower. The index excluding food and energy rose 0.2% in March, while shelter increased 0.3% and food was unchanged. (bls.gov) That split matters because it separates the oil shock from the rest of household spending. The 12-month inflation rate rose to 3.3% in March from 2.4% in February, while core inflation reached 2.6%. (bls.gov) Tariffs are showing up more clearly in goods prices than in the headline number. Federal Reserve researchers wrote on April 8 that tariffs imposed through November 2025 had raised core goods personal consumption expenditures prices 3.1% through February 2026 and added 0.8% to core personal consumption expenditures overall. (federalreserve.gov) The same Federal Reserve note said the pass-through from those tariffs to consumer prices was “effectively complete” by seven months after implementation. The authors found the biggest effects in goods categories with heavier exposure to imported products. (federalreserve.gov) A separate April 1 update from the Budget Lab at Yale found imported core goods and durable goods prices both rose 1.5% during 2025 through January. Its estimated tariff pass-through ranged from 46% to 86% for core goods and 51% to 115% for durables, depending on the method used. (budgetlab.yale.edu) That does not mean tariffs caused the March gasoline spike. The Bureau of Labor Statistics tied March’s headline surge directly to energy, and the Energy Information Administration said higher crude prices in the first quarter followed military action in the Middle East on February 28 and disruptions around the Strait of Hormuz. (bls.gov) (eia.gov) The Energy Information Administration said on April 7 that Brent crude averaged $103 a barrel in March and expected it to peak at $115 in the second quarter of 2026. Its April outlook also said higher crude prices were pushing up retail gasoline and diesel prices. (eia.gov 1) (eia.gov 2) So March inflation captured two different pressures at once: an oil shock that hit pump prices fast, and tariff effects that Federal Reserve and Yale researchers say have been building in imported goods for months. The next Consumer Price Index reports will show whether that mix broadens beyond energy or starts to fade. (bls.gov) (federalreserve.gov) (budgetlab.yale.edu)