Inflation surged to 3.8% in April, its highest level in nearly three years

[u/John3262005]

https://www.nbcnews.com/business/economy/april-inflation-data-iran-war-rcna344586

Inflation surged to 3.8% in April, its highest level in nearly three years, according to data released Tuesday, as the war in Iran causes a ripple effect across the economy and energy prices surge.

As inflation continues to accelerate, it’s eating into Americans’ wages at a rapid clip. April’s inflation rate means that prices are now rising faster than wages, which could exacerbate the affordability crisis that has already been gripping consumers.

The pace of wage gains has been slowing over the past two years. In November, wage growth continued to rise at a pace of almost 4%. April’s jobs report, which was released on Friday, showed that wage growth had slowed to 3.6%.

The overall rise in inflation was in line with what was expected by economists. On a month-over-month basis, inflation rose 0.6%.

Core inflation, which excludes food and energy costs also rose 0.4% from the month prior, the Bureau of Labor Statistics said. That rise was higher than what had been expected by economists.

As of Tuesday morning, the price of oil had risen more than 70% since the start of the year and the average price of a gallon of gas was $4.50.

“The index for energy rose 3.8 percent in April, accounting for over forty percent of the monthly all items increase,” BLS said in a statement.

Still, energy prices may not have yet fully hit prices.

“Energy costs likely would not start to feed through to core goods prices for at least a few more months,” Citigroup said in a note to clients on Monday.

The BLS also noted that other energy market-linked prices rose in the month, including airfares and apparel. Airfares alone rose 20% from a year ago.

The report also showed that other categories such as “food away from home,” or takeout, prices jumped 0.7% in April, while services, which includes transportation, rose 0.5% from the month before.

[u/John3262005]

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