US inflation climbed to its highest point in three years, driven by soaring energy costs
US inflation surged at its fastest pace in three years, primarily fueled by rising energy costs amid tensions with Iran, according to the Personal Consumption Expenditures (PCE) price index for April.
Regarded as the Federal Reserve’s preferred inflation measure, the index rose 3.8% over the 12 months ending in April, marking the steepest increase since May 2023, Reuters reported on Thursday, citing data from the Commerce Department’s Bureau of Economic Analysis.
The PCE inflation rate for March remained unchanged at 3.5%, the report added.
Month-over-month, the PCE price index climbed 0.4% in April, a slight slowdown from the 0.7% gain recorded in March.
The core PCE price index, which excludes volatile food and energy prices, increased by 0.2% in April, falling short of expectations, CNN noted. However, its annual growth rate rose to 3.3%.
Consumer spending grew by 0.5% in April, down from a 1% rise the previous month. After adjusting for inflation, real consumer spending increased by only 0.1%.
Additionally, gasoline prices continued their upward trend in April. The national average retail price for gasoline jumped 12.3%, according to the U.S. Energy Information Administration. Since the onset of the conflict between the US and Iran at the end of February, gas prices have surged by more than 50%.
