United States: Inflation hits highest level since August 2018 in March
Consumer prices rose a seasonally-adjusted 0.62% from the previous month in March, following February’s 0.35% rise. March’s reading marked the sharpest increase in prices since June 2009. Looking at the details of the release, prices for energy and transportation rose notably in March compared to the previous month.
Inflation came in at 2.6% in March, up from February’s 1.7%. March’s reading was the highest inflation rate since August 2018. Annual average inflation ticked up to 1.2% in March (February: 1.1%). Lastly, core inflation rose to 1.6% from the previous month’s 1.3%.
Commenting on inflationary pressures ahead, James Marple, a senior economist at TD Economics, noted:
“Thinking about the inflation outlook, pandemic-related supply shortages are likely to reverse the negative thrust in goods prices that has held down inflation for the past decade. Services prices are also likely to head higher, especially in sectors that have been restricted and where capacity has been impacted, while rent growth is likely to continue to accelerate as the economy normalizes, already evident in the pickup this month.”