Today’s Consumer Price Index (CPI) report shows that prices rose 3.3% over the past year in March. Prices jumped by 0.9% in the past month alone. The rise in prices was largely driven by the energy price shock caused by Trump’s war with Iran, which rose significantly Oil prices Push the gasoline to the top $4 per gallon. This report is the first complete picture of inflation since the beginning of the conflict. Even with a two-week ceasefire, global supply chains remain disrupted, and inflationary shock waves will continue to batter Americans’ wallets for months to come.
Managing Director of Policy and Advocacy at Groundwork Collaborative Elizabeth Pancotti She shared her reaction:
“Today’s inflation report comes as no shock to anyone who filled up their gas tank last month. The toll of Trump’s war on Iran won’t stop at the gas stations — price hikes on summer vacations, groceries, and electronics are falling, as his war wreaks havoc on supply chains around the world. By continuing this illegal war, the President has made clear he is putting American families last.”
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High energy prices lead to higher inflation. Energy prices in March rose 12.5% compared to last year and 10.9% in March alone. Gasoline prices rose from just under $3 before the conflict to more than $4 per gallon, and diesel prices rose by more than 50% to more than $4 per gallon. $5.68That’s just 13 cents below the high seen in June 2022. Rising gasoline prices accounted for nearly three-quarters of the increase in headline inflation last month.
The ramifications of Trump’s agenda don’t stop at the gas pump. The core CPI, which excludes food and energy, rose 2.6% over the past year, up from 2.5% and 0.2% over the past month.
- There were significant monthly jumps in the prices of computer software and accessories (4%) and airline ticket prices (2.7%).
- Following the Supreme Court’s ruling against the IEEPA tariffs, Trump imposed a 10% global tariff, effectively blocking any relief for American families. Last month alone, prices of mainly imported goods, such as clothing and toys, rose by more than 2%.
- Persistent inflation also continues in major service categories, with health care services up 3.7% and housing prices up 3% over the past year. Instead of providing aid to American families, Trump proposed eliminating more than $8 billion in housing and utility funding in his country. Budget for fiscal year 27 Last week.
A fragile ceasefire cannot reverse the damage already done. Even if the conflict is fully resolved and traffic through the Strait of Hormuz resumes without interruption, prices will continue to rise in the coming months as higher input costs are passed on to consumers. Steel, aluminium, plastics and fertilizer prices have risen, and this rise in input costs continues to impact supply chains.
- If the ceasefire continues… KPMG Inflation is expected to remain high in the coming months, with energy prices remaining high before gradually declining. If the war continues, inflationary pressures will intensify and persist, with oil prices rising, prolonging the cost of living crisis and weakening the economy in general.
- the Federal Reserve He even warned that if the conflict continues, it will lead to more sustained energy shocks that are likely to fuel broader inflation in the coming months.
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