The spike in energy prices caused by the war in Iran pushed the annual inflation rate to 3.3% in March, according to new economic data released Friday by the federal government.
The Consumer Price Index showed that for the 12-month period ending in March the inflation rate was nearly a full percentage point higher than February’s annual pace of 2.4%. On a monthly seasonally adjusted basis, the increase was 0.9%, the highest since June of 2022.
Nearly three-quarters of the monthly all-items increase in consumer products was caused by a 21.2% increase in the index for gasoline, which drove a 10.9% overall increase in the monthly energy index. The food index was unchanged over the month, and the shelter index rose 0.3%.
The core index, which excludes more volatile food and energy costs, increased 0.2% in March, as it did in February. Other indexes that increased over the month include airline fares, apparel, household furnishings and operations, education, and new vehicles.
Conversely, the indexes for medical care, personal care, and used cars and trucks were among major indexes that decreased over the month.
On an annual basis, the core index excluding food and energy rose 2.6% for the 12-month period ending in March. The shelter index has increased by 3.0% over the past year. Other notable annual increases include medical care (+3.1%), household furnishings and operations (+4.0%), airline fares (+14.9%), and recreation (+2.2%).
The energy index has increased 12.5% overall over the 12 months ending March. Compared to March 2025, this reflects a 44.2% increase in the cost of fuel oil, an 18.9% increase for gasoline, a 5.0% increase for electricity, and a 4.6% increase for utility piped natural gas.
The food index has increased 2.7% over the same 12-month period.
Stock market reaction was mixed after the March CPI was released. The Nasdaq and S&P 500 edged higher during Friday morning trading, while the Dow Jones Industrial Average fell.
