April CPI rises 0.6% as annual inflation ticks up to 3.8%

The prices for goods and services continued to climb month-over-month in April, but at a slower pace than they did in March. 

In April the Consumer Price Index for all items rose 0.6% from a month prior on a seasonally adjusted basis, according to data released Tuesday by the U.S. Bureau of Labor Statistics. This is down from a 0.9% month-over-month increase in March. 

Annually, inflation was at 3.8% prior to seasonal adjustment in April, up from the 3.3% year-over-year increase recorded in March. 

The “all items less food and energy” index was up 2.8% annually and 0.4% from a month prior.

On a monthly basis, the energy index rose 3.8%, accounting for over 40% of the all-items index’s monthly increase, while the food index rose 0.5%. Although the energy index’s monthly increase was high, it was lower than the 10.9% monthly increase recorded in March.

Year-over-year, the energy index was up 17.9% in April and the food index jumped 3.2%. The gasoline index was a main contributor to the energy index’s increase, as it jumped 28.4% from a year ago, according to the data. 

“Anyone who is filling their tank with gas this week is seeing firsthand the impact of this inflation report. Rising energy costs are the main driver that will continue to apply pressure to the Federal Reserve to resist cutting interest rates, despite the expected change in the chair position later this week,” Selma Hepp, Cotality’s chief economist, said in a statement. “We will see three speeches this week from members of the Fed committee, and we hope there will be some indication of how the new leadership will approach interest rate policy going forward.”

The index for shelter was up 0.6% from March and 3.3% compared to a year prior. This increase came as the indexes for rent and owners’ equivalent rent both rose 0.5% on a monthly basis.

Other indexes with notable increase over the past 12 months include medical care (+2.5%), airline fares (+20.7%), household furnishings and operations (+3.9%) and recreation (+2.3%).