On the 8th of last month, at the entrance of a gas station in Washington, USA, an electric billboard with the price of gasoline was erected. The US consumer price index rose 8.5% in March compared to the same month last year, the largest increase in more than 40 years. Washington = AFP Yonhap News
The US consumer price index rose 8.5% in March compared to the same month last year. This is the largest increase in 40 years since December 1981.
The U.S. Department of Labor announced on the 12th (local time) that the U.S. consumer price index (CPI) rose 8.5% from March last year. This is higher than the 7.9% increase in CPI in February. The March CPI rose 1.2% from a month earlier. This figure is also the record for the largest increase since 2005.
As a result of the data company FactSet’s March CPI forecast for The Economist, an 8.4% increase was expected. The actual result is an increase of 0.1 percentage point from this. Among the CPIs in March, the core CPI rose 6.4% from the same month last year, excluding energy and food, which have high volatility.
The inflation rate in March was the first to reflect the sharp rise in gasoline prices and the sharp rise in raw material and food prices following Russia’s invasion of Ukraine on February 24. According to the American Automobile Service Association (AAA), the price of gasoline in the United States stood at $4.11 per gallon (3.78 liters), up 44% from a year ago. It is analyzed that the increase in energy prices has raised the transportation and manufacturing costs of various goods, raw materials, and parts, and as a result, consumer prices have also risen.
As the inflation rate in March recorded the highest in more than 40 years, the US central bank’s Federal Reserve is also expected to aggressively raise interest rates in the future to curb inflation. At the Federal Open Market Committee (FOMC) meeting last month, the Fed raised the US benchmark interest rate by 0.25 percentage points. This was the first impression since December 2018. The Fed is expected to raise rates once more by 0.25 to 0.50 percentage points at its May meeting.
On the 11th, the US stock market also reacted sensitively, with the Dow Jones Industrial Average falling 1.19% (413.04 points) from the battlefield in response to the March CPI increase.
Washington = Jeong Sang-won correspondent ornot@hankookilbo.com
