Al Jazeera reports: Prices rose by 3.3 percent in March.The increase was driven by a surge in energy prices, including prices for petrol or gasoline, which rose by 5.4 percent.On an annual basis, the increase is stark. Energy prices surged by 17.9 percent over the last 12 months, with petrol prices up 28.4 percent compared to this time last year.The average price for a gallon (3.78 litres) of petrol is $4.50, according to the American Automobile Association (AAA), which tracks daily petrol prices. The average price was $2.98 when the US and Israel first struck Iran on February 28.“The passthrough of higher energy costs to non-energy prices was most apparent in airfares, which airlines have had to raise to cover rising jet fuel prices,” Bernard Yaros, lead US economist for Oxford Economics, said in a report provided to Al Jazeera.Airfares rose by 2.8 percent compared to the month prior, driven by heightened jet fuel costs that have put strains on air carriers, including Spirit Airlines, which ceased operations earlier this month after 34 years in business.
The airline attributed heightened fuel costs to “recent geopolitical events” in court documents. The White House said that the bump in prices will likely be temporary. Advertisement “President Trump has always been clear about temporary disruptions as a result of Operation Epic Fury,” White House spokesperson Kush Desai told Al Jazeera.Economists say that conflict with Iran will keep prices high.“We still look for CPI inflation to peak this quarter at a pace well below its pandemic-era heights.
Background
While the core CPI will remain elevated this year, it’s unlikely to move significantly higher from here,” Yaros said.Grocery prices jumpGrocery prices are also on the rise, up by 0.7 percent. Prices for meat, poultry, fish and eggs rose by 2.7 percent compared to the previous month. The price of beef specifically jumped 2.7 percent.Fruit and vegetable costs surged 1.8 percent.
Key facts
- The airline attributed heightened fuel costs to “recent geopolitical events” in court documents.
- The White House said that the bump in prices will likely be temporary.
- Prices for meat, poultry, fish and eggs rose by 2.7 percent compared to the previous month.
What this means
The price, however, has ticked up on a month-by-month basis by 1.5 percent.The White House also pointed to a decrease in smartphone prices of 12 percent since this time last year, although prices have increased by one percent from this time last month.Smartphones were exempt from the tariffs that US President Donald Trump imposed last year.Other tariff-exposed sectors saw price increases, with the price of clothing jumping by 0.6 percent, as did the cost of electronics overall. Both bedroom furniture and toys jumped 0.8 percent.Healthcare costs, on the other hand, saw a decrease. Overall, drug prices fell by 0.4 percent from this time last month and were down 0.5 percent from this time last year.
Prescription drug prices remained flat on a month-over-month basis and have tumbled by 0.9 percent.“The April CPI report reinforces, however, that President Trump’s long-term economic agenda continues to deliver despite these disruptions: drug and hospital services prices are declining thanks to the president’s Most-Favored-Nation and price transparency initiatives,” Desai said.On Wall Street, US markets tumbled on the heels of the report. The tech-heavy Nasdaq is down 1.4 percent, the Dow Jones Industrial Average is down by 0.6 percent, and the S&P 500 is 0.8 percent lower in midday trading.
Originally reported by Al Jazeera. This story has been edited and re-presented by BRIC Team.
