Inflation rose to 3.5% in March in Fed’s preferred gauge because of Iran war fallout
Inflation rose to 3.5% in March year-over-year according to the PCE index, the Federal Reserve's preferred measure, driven largely by higher energy prices due to the conflict with Iran. Core inflation, which excludes food and energy, increased to 3.2% annually and 0.3% monthly, remaining above the Fed's 2% target. The Fed held interest rates steady in March, its final meeting under Chair Jerome Powell, who will remain on the Board of Governors after his chairmanship ends.
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Inflation jumped seven tenths of a percentage point to 3.5% for the year ending in March in the personal consumption expenditures index, the Bureau of Labor Statistics reported Thursday. The surge in energy prices from the conflict with Iran drove much of the increase in headline inflation. Recommended Stories GDP growth rebounded to 2% rate in first quarter Powell says he will stay on Fed board after chairmanship ends, denying Trump a spot WATCH LIVE: Powell’s last Federal Reserve interest rate decision before stepping down WARSH NOMINATION ADVANCES AFTER TILLIS BLOCKADE ENDS The inflation reading is the highest since May 2023 for the PCE, which is the Federal Reserve’s preferred gauge. In March alone, prices rose 0.7%.
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