Fox News chief national security correspondent Jennifer Griffin reports on traffic conditions in the Strait of Hormuz, Iran’s demand to impose tolls on passing ships, and ceasefire talks on Varney & Co.
inflation increased Consumer prices jumped in March amid economic disruptions caused by the impact of the Iran war on energy markets.
The Bureau of Labor Statistics said on Friday that Consumer Price Index (CPI) — a broad measure of the cost of everyday items like gasoline, groceries and rent — rose 0.9% from a month earlier and are 3.3% higher than a year earlier. The annual figure increased from the previous month’s 2.4% reading, while the monthly increase also increased significantly from the previous month’s 0.3% reading.
expectations vs reality
The 0.9% monthly increase and 3.3% annual increase were both in line with the expectations of economists surveyed by LSEG.
So-called core prices, which exclude volatile measures of gasoline and food to better assess price growth trends, were up 0.2% on a monthly basis and 2.6% from a year earlier. Both of these figures were slightly lower than economists’ estimates of 0.3% and 2.7%, respectively.
Key CPI figures were slightly warmer than February’s reading, which showed prices rose 0.2% on a monthly basis and 2.5% over the past year.
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Economists have noted that inflation data from December 2025 to April 2026 will be affected by a disruption in data collection as a result of last autumn’s 43-day government shutdown.
During the shutdown, the BLS was not able to collect data and used the carry-forward method to compensate for the lack of October CPI report and missing data in the November report. Economists say this is likely to lead to a decline in inflation data until this spring, when fresh data will negate the anomaly.
The CPI increased significantly in March due to rising energy prices. (Zheng Hui/Xinhua via Getty Images)
Cost of Living Breakdown
High inflation in recent years has created severe financial pressure for most American families, who are forced to pay more for everyday needs like food and rent. Price increases are especially difficult for low-income Americans, because they spend more of their already inflated paychecks on necessities and have less flexibility to save.
Food prices were stable on a monthly basis in March and were up 2.7% from a year earlier. The meals at home index declined 0.2% this month and is 1.9% higher than last year, while the meals away from home index is 3.8% higher than a year ago after increasing 0.2% on a monthly basis.
Meat, poultry and fish prices were down 0.5% this month but 5.6% higher than a year earlier. Beef and veal prices fell 0.6% in March and are 12.1% higher than a year earlier. Egg prices continued to fall after the avian flu outbreak hit supplies, with prices down 3.4% for the month and 44.7% from a year earlier. The fruits and vegetables index rose 1% in March and is up 4% year-on-year.
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The closure of the Strait of Hormuz due to the Iran war has disrupted oil supplies from the Middle East. (Giuseppe Cacace/AFP via Getty Images)
Energy prices rose 10.9% in March due to disruptions in Middle Eastern oil supplies caused by the Iran war, compared with a 12.5% ​​increase last year. The BLS noted that energy accounted for about three-quarters of the total monthly CPI increase.
Gasoline prices rose 21.2% in March and are 18.9% higher than a year ago. Utility gas service prices declined 0.9% on a monthly basis and are 6.4% higher than a year ago. Electricity costs rose 0.8% in March and have increased 4.6% in the past year.
Housing prices rose 0.3% in March and are 3% higher than a year earlier. Renters and home insurance costs rose 0.9% this month and are 7.4% higher than a year ago.
Transportation service prices were up 0.6% for the month and 4.1% from a year earlier. Motor vehicle maintenance and repair costs increased by 1.3% monthly and 6.1% annually. Auto insurance prices were steady in March and are 0.8% higher than a year ago. Airline fares rose 2.7% in March and are up 14.9% from a year earlier.
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Fed Chairman Jerome Powell and central bank policymakers are monitoring the economic impact of the war. (Al Drago/Bloomberg/Getty Images)
expert analysis
“As expected, the jump in inflation today reflects the rise in energy prices,” said Ellen Zentner, chief economic strategist at Morgan Stanley Wealth Management. “The market may continue to grapple with concerns that sticky inflation could become a quagmire as long as oil remains high, but the Fed will likely continue its ‘cautious’ strategy – not pivot to rate hikes.”
Jeffrey Roach, chief economist at LPL Financial, said, “Since the Hormuz chokepoint was closed for an extended period, we should expect one or two warm inflation prints, driven by transportation services and some durable goods categories. The second order effect is likely to add another 0.2 over the next few months. The Fed is clearly on hold for the next several meetings.”
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“In the absence of the downward bias from the BLS methodology used to fill data gaps during the October government shutdown, we estimate CPI inflation would have been 0.3-0.4 percentage points higher,” said Gregory Daco, chief economist at EY-Parthenon.
He said that “Energy and food-driven rebound will push headline CPI inflation to 3.6% in April-May, with core CPI tentatively rising to 2.9% in May-June. We have raised our December 2026 forecast for headline CPI inflation to 3.0% y/y and now see core inflation hovering around 2.6% y/y.”
