US inflation accelerated further in April as rising energy and shelter costs kept price pressures elevated. Headline CPI rose 0.6% mom, matching expectations, while core CPI increased 0.4% mom, above the expected 0.3% gain and signaling broader underlying inflation momentum beyond energy alone.
The energy component remained the dominant driver of the monthly increase. The energy index rose 3.8% mom after surging 10.9% in March, accounting for more than 40% of the overall monthly rise in consumer prices. Gasoline prices alone climbed 5.4% during the month and were up 28.4% compared with a year earlier as the Middle East conflict continued disrupting global energy markets. Shelter costs also remained firm, rising 0.6% mom, while food prices increased 0.5% mom.
On an annual basis, headline CPI accelerated from 3.3% yoy to 3.8% yoy, above expectations of 3.7% yoy and marking the highest reading since May 2023. Core CPI also strengthened from 2.6% yoy to 2.8% yoy, exceeding forecasts of 2.7% yoy.
The report is likely to further reduce expectations for Fed rate cuts this year and may even revive market discussion around the possibility of additional tightening if energy-driven inflation pressures continue broadening into core categories.
| Indicator | Previous | Latest | Expectation |
|---|---|---|---|
| Headline CPI (MoM) | 0.9% | 0.6% | 0.6% |
| Core CPI (MoM) | 0.2% | 0.4% | 0.3% |
| Headline CPI (YoY) | 3.3% | 3.8% | 3.7% |
| Core CPI (YoY) | 2.6% | 2.8% | 2.7% |
