US Inflation Data Rises Over 3.5% in March

The US inflation data for March has arrived, with the amount rising to 3.5%, more than many predicted. Indeed, the outcome has resulted in a second consecutive month of rising inflation. Furthermore, it significantly limits the Federal Reserve’s ability to slash interest rates.

The Bureau of Labor Statistics announced that inflation had risen from 3.2% in February. Now, all eyes are on how the Federal Reserve will react to the news. Specifically, the markets will seek guidance from Fed Chair Jerome Powell on where the Central Bank will take the interest rate debate.

Combating US Inflation Increase Rates

Combating increasing inflation rates has been the Federal Reserve’s most critical struggle for the US economy in recent years. Indeed, the Central Bank has maintained its 2% objective with more than a year’s worth of interest rate hikes.

Although the market anticipated a rate drop following favorable developments in recent months, March data has dashed those expectations. The US inflation rate has jumped to 3.5%, higher than expected.

The uptick continues a tendency that began last month. According to February figures, inflation jumped to 3.2%, up from 3.1% in January. Furthermore, today’s numbers reveal the most significant inflation rate since December, which was published at 3.4%.

As previously said, all attention will now be on statements from Fed Chair Jerome Powell. He has already informed residents to expect three rate decreases in 2024. This was explicitly stated when the Federal Reserve decided not to make such cuts in the year’s first four months. Now, forecasts for interest rate reduction have dropped to their lowest point since October 2023.