Surging Oil Prices Drive Inflation Higher, U.S. March CPI Jumps Sharply

BlockBeats News, April 10th. The U.S. Department of Labor data released on Friday showed that the CPI rose by 3.3% year-on-year in March, significantly higher than February's 2.4%. Core inflation, which excludes the food and energy categories, rose by 2.6%, slightly lower than the market's expectation of 2.7%. Energy prices in March rose by 12.5% year-on-year, a significant acceleration from February's 0.5%. Gasoline prices rose by 18.9%, and fuel oil rose by 44.2%. The report released on Friday was the first to reflect the impact of the Iran war on U.S. inflation. The closure of the Strait of Hormuz disrupted shipping and drove up crude oil and gasoline prices last month.

Economists warn that even if the Strait of Hormuz fully reopens, energy and commodity prices that rose after the outbreak of war are unlikely to immediately return to their previous levels. Businesses typically react quickly when raising prices but are more gradual when lowering them. Lindsey Piegza, Chief Economist at Stifel, said, "Most of these effects are likely to be seen one to two months later." (Jin10)