On Tuesday, new data will be released regarding the inflation situation in the United States, which is currently facing upward pressure from the ongoing conflict in Iran that is affecting global prices for fuel and food.
According to a recent Bloomberg survey, economists predict that the Consumer Price Index (CPI) for April will show a year-on-year increase of 3.7%, along with a rise of 0.6% compared to March. This follows a significant increase in March, which recorded the largest month-to-month surge since 2022.
The anticipated rise in consumer prices for April is likely linked to escalating energy costs. As of Monday, the average price for petrol at the pump was $4.52 per gallon, marking an approximate 44% increase from the previous year, according to AAA.
The impact of rising fuel prices could extend to the travel industry. The average domestic airfare reached $365 in the week of April 27, up from $346 shortly after the outbreak of the war, based on data from Kayak. International airfares have experienced an even steeper increase, climbing from $805 in early March to about $1,100 in the most recent figures.
Additionally, the surge in energy expenses could eventually contribute to higher food prices in the U.S. as diesel costs rise. However, a noticeable effect on grocery prices may take time to materialise domestically.
Excluding the more volatile categories of energy and food, economists expect core prices to have increased by 2.7% compared to a year ago, which is a slight uptick from the 2.6% increase seen in March. This figure remains closer to the Federal Reserve’s target of 2%. However, a spike in shelter costs is projected in the upcoming April report due to data discrepancies resulting from last year’s government shutdown.
For more insights and updates on the economy, you can reach out to Emma Ockerman, a reporter covering economic and labour issues, at emma.ockerman@yahooinc.com.
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