Economists expect consumer prices climbed a stunning 1.1% in March as the Russia-Ukraine war drove up the cost of oil and commodities and exacerbated supply chain slowdowns that have for months been contributing to inflation.
The latest reading, which will be released Tuesday morning, will add to mounting pressure on the Federal Reserve to move faster to rein in spiraling inflation, potentially by raising interest rates by a half-point when central bank officials meet next month.
Economists are forecasting the consumer-price index rose at an 8.4% annual rate in March, up from 7.9% in February and the fastest pace since 1982. That will mark the seventh straight month of increases in the annual rate.
Consensus expectations are for the month-over-month rate to have accelerated from 0.8% in February to just over 1% in March, as the war picked up steam and the U.S. banned imports of Russian oil and gas.
So-called core CPI, which excludes the volatile food and energy indexes, is expected to have climbed 0.5% over the month, matching the previous month’s pace. The core CPI is expected to be up 6.5% in March from a year ago, marking a slight uptick from February’s 6.4% pace.
Any reading at or above consensus expectations will mark the fifth straight month of prices rising at the fastest annual pace in 40 years.
The data will likely only push Americans’ inflation expectations for the coming year ever higher, a phenomenon that concerns economists because heightened expectations can affect consumer behavior in a way that in turn pushes up actual inflation. Median one-year inflation expectations rose again in March to a series high of 6.6%, according to the New York Fed’s Survey of Consumer Expectations, which was released Monday.