The US inflation rate rose to 3.8 percent in April, according to data released Tuesday by the US Bureau of Statistics. This represents a significant quarter-over-quarter jump of 0.9 percentage points.
Looking at the components, the measure known as “core inflation”-which excludes energy and food prices-rose to 2.8 percent for April, up from 2.6 percent recorded in March. Meanwhile, energy prices saw a year-over-year increase of 17.9 percent, following a robust jump of 12.5 percent in the previous month. Experts suggest that the ongoing conflict in the Middle East continues to be a central driver behind these energy price increases. Food prices also recorded an annual increase of 3.2 percent, compared to 2.7 percent in March.
Investors pay close attention to US inflation figures because they offer a critical insight into the interest rate policy of the Federal Reserve (the Fed). Elevated interest rates are generally viewed negatively for both the stock market and the real estate sector, partly because the bank account remains an attractive savings alternative.