Economist: U.S. March CPI Monthly Rate Could Surge by 1%; Federal Reserve May Find It Difficult to Cut Interest Rates This Year

ME News report, April 5 (UTC+8). Economists say the sudden jump in gasoline prices that American consumers can feel firsthand will be fully reflected in the key inflation data to be released this week. It is expected that the US March CPI will rise 1% month-on-month, the largest single-month increase since 2022; core CPI may increase 0.3% month-on-month. Previously, the Iran war pushed gasoline prices at US gas stations up by about $1 per gallon. The day before the CPI data is released, the Fed’s preferred inflation gauge will provide information on pre-war price pressures. Economists expect the core PCE price index may have risen 0.4% for the third consecutive month in February, indicating that even before the outbreak of hostilities, the process of inflation cooling to more moderate levels has stalled. Combined with signs that the US labor market is stabilizing, stubborn price pressures, and new inflation risks brought by the Middle East war, this helps explain why the Federal Reserve may find it difficult to cut interest rates this year. (Source: Jin10)