US inflation jumped to 3.3%

U.S. consumer prices rose 3.3% in March from a year earlier, the fastest annual inflation since 2024. (bls.gov) The Bureau of Labor Statistics said the Consumer Price Index climbed 0.9% in March alone, up from 0.3% in February. Core inflation, which strips out food and energy, rose 0.2% on the month and 2.6% over 12 months. (bls.gov) Energy drove most of the jump. The energy index rose 10.9% in March, gasoline surged 21.2%, and the agency said gas accounted for nearly three quarters of the monthly increase in overall prices. (bls.gov) Other categories looked less extreme. Shelter rose 0.3% in March, food was unchanged, food at home fell 0.2%, and medical care and used car prices were among the indexes that declined. (bls.gov) The new reading lands less than a month after the Federal Reserve left its benchmark interest rate at 3.5% to 3.75% on March 18. Federal Reserve officials said then that inflation readings had run higher than expected and kept their 2% inflation target in place. (cnbc.com) Federal Reserve policymakers also raised their inflation projections in March, based on information available at that meeting. Those forecasts were set before the April 10 Consumer Price Index report showed the latest acceleration. (federalreserve.gov) Tariffs are part of the policy debate, but economists do not agree on a simple one-month link from tariffs to headline inflation. A March 30 paper from the Federal Reserve Bank of San Francisco said tariff shocks can first push inflation down through weaker demand and only later lift goods and services prices. (frbsf.org) A separate April 1 update from the Budget Lab at Yale found evidence that 2025 tariffs raised customs revenue and lifted some imported consumer goods prices, while also cautioning that its figures are descriptive and not a causal estimate of the whole economy. (budgetlab.yale.edu) For households and companies, the March report points to a familiar split: a sharp fuel shock in one month, but a slower pace in the underlying categories the Federal Reserve watches closely. The next inflation releases will show whether March was a spike centered on energy or the start of a broader run of price increases. (bls.gov)