Inflation concerns linger with elevated consumer prices in April
Consumer prices in the U.S. accelerated in April after months of declines, with measures of underlying inflation suggesting that rising costs could persist for months to come, the Associated Press reports.
Prices rose 0.4% from March to April, the government said this morning, in comparison to 0.1% from February to March. From a year earlier, prices climbed 4.9%, down just slightly from March’s year-over-year increase.
The nation’s inflation rate has steadily cooled since peaking at 9.1% last June but remains far above the Federal Reserve’s 2% target rate.
The Fed is paying particular attention to so-called “core” prices, which exclude volatile food and energy costs and are regarded as a better gauge of longer-term inflation trends. Core prices rose 0.4% from March to April, the same as from February to March. Compared with a year ago, core prices rose 5.5%, just below a yearly increase of 5.6% in March.
Economists say the overall slowdown in U.S. inflation since last summer might turn out to have been a relatively easy phase of the nation’s drive to conquer inflation. Unlike goods prices, the costs of services are still surging. A major reason is that companies have had to raise pay in those industries to find and retain workers.
Last week, the Fed signaled that it might pause its interest rate increases, after imposing 10 straight hikes so that it could take time to assess how higher borrowing costs have affected the economy. The full economic impact of the hikes, though, might not become evident for months.