Consumer prices surged 3.8% in April from a year ago, driven by energy inflation

US consumer prices continued their rapid ascent in April as the war in Iran pressured global fuel and food costs, government data released Tuesday showed.

The Consumer Price Index for April showed prices were 3.8% higher than a year ago — the largest annual increase in three years — and up 0.6% on a monthly basis, largely due to soaring energy costs. Economists had expected a rise of 3.7% from last April, according to a Bloomberg survey, and a 0.6% increase from March, which itself saw the largest monthly gain since 2022.

Energy prices were up 3.8% from the month prior, after March showed a 10.9% monthly jump. The overall energy index was 17.9% higher than a year ago, while the index for gasoline rose 28.4%.

 

 

Stripping out the more volatile energy and food categories, prices on a “core” basis also ticked up more than expected, rising 2.8% in April from a year ago and 0.4% from the month prior. Economists had anticipated a yearly increase of 2.7% and a monthly rise of 0.3%, slightly hotter than March’s reading.

“There is an upward trajectory in inflation that hasn’t shown signs of turning yet. That is the key message,” George Bory, Allspring Global Investments chief investment strategist for fixed income, told Yahoo Finance on Tuesday.

“This is painful for Americans, especially moderate-income households,” Heather Long, chief economist for Navy Federal Credit Union, posted on X.

Higher prices for regular expenses

Average gasoline prices are now hovering above $4.50 per gallon, according to AAA’s data. This time last month, AAA put the average at $4.13.

The surge in fuel costs is also trickling into airfares, which were up 2.8% from March and 20.7% from last year.

Food costs continued to bite, rising 3.2% from a year ago. Meat kept getting more expensive, with beef and veal prices up 2.7% from March and the price of hot dogs soaring 5.8%.

Tomatoes surged again, rising 15.1% in a month. They’re up nearly 40% from last year.

Shelter costs, which were expected to jump in April’s report due to data distortions after last year’s government shutdown, rose 0.6% from March.

“Housing costs are still fairly elevated, and that’s a big part of what people consume,” Bory added.

Emma Ockerman is a reporter covering the economy and labor for Yahoo Finance. You can reach her at emma.ockerman@yahooinc.com.

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