Consumer prices rose 0.6% in the United States in March, according to data released Tuesday by the Labor Department, a trend that could continue in the coming months due to a sustained recovery in the economy.
Market analysts expected 0.5%.
In 12 months, inflation reaches 2.6%, the highest level since the autumn of 2018.
The accumulated figure is due in particular to the increase in gasoline prices, which rose 9.1% in February.
A year ago, the prices of fuel, airfare, accommodation and tourism fell due to the impact of confinement measures on the economy to fight the coronavirus pandemic.
Some of these sectors, particularly affected, now register significant price increases associated with greater demand: hotels and tourism + 3.8%, car rental + 11.7%, car insurance + 3.3%.
“The skyrocketing number of passengers” on airlines “and hotel occupancy rates clearly signals an increase in prices, while auto insurance costs will rise as people return to work by car,” estimated Ian Shepherdson, an economist at Pantheon Macroeconomics.
Core inflation, which does not consider energy and food with more volatile prices, reached 0.3% in March (compared to 0.1% in February) and 1.6% in 12 months.
The index that measures food prices increased 3.5% compared to March 2020, and the one that measures energy prices rose 13.2%.
In the coming months, due to the reopening of the economy and difficulties in the supply chains, inflation will continue on the upward path until reaching 3.5% in its annual projection (the figure that is estimated would reach if the fundamentals are maintained), highlighted Kathy Bostjancic, chief economist at Oxford Economics.
The price increase is directly linked to the reactivation in the United States, where almost a quarter of the population is vaccinated against the coronavirus. In addition, a part of Americans have more money by not having spent on trips, or thanks to direct cash aid emanating from the federal government in the framework of different reactivation plans.
– Looking at the Fed –
The markets fear an inflationary push, but the Federal Reserve, the IMF and the White House consider that this increase in prices will be temporary.
US government advisers anticipate, like the Fed, “a modest rise in inflation (…) which will then decline.”
The Federal Reserve has an inflation target of 2% per year as measured by the PCE index. The central bank considers that the figure must exceed 2% for a certain time to later stabilize, after a quarter of a century of very low inflation.
The Fed announced that it will not raise its benchmark rates because it would compromise its other central objective, which is full employment.
“This idea is valid for a certain time. But if the rise in inflation persists, and if it is accompanied by a faster increase in wages, the Fed line will be unsustainable,” estimated Shepherdson.
jul / vmt / abx / mr / lda