Inflation surged in March as Iran war's energy impact hit consumers

This story on the March 2026 CPI inflation report is developing and will be updated with further details.

Inflation surged in March as consumer prices jumped amid the economic disruptions caused by the Iran war’s impact on the energy market.

The Bureau of Labor Statistics on Friday said that the consumer price index (CPI) – a broad measure of how much everyday goods like gasoline, groceries and rent cost – rose 0.9% from a month ago and is 3.3% higher than last year. The annual figure jumped from last month’s 2.4% reading, while the monthly increase also rose markedly from last month’s 0.3% reading.

Expectations vs. reality

Both the 0.9% monthly increase and 3.3% annual rise were in line with the expectations of economists polled by LSEG.

So-called core prices, which exclude volatile measurements of gasoline and food to better assess price growth trends, were up 0.2% on a monthly basis and 2.6% from a year ago. Both of those figures were slightly cooler than economists’ predictions of 0.3% and 2.7%, respectively.

The core CPI figures were slightly hotter than February’s readings, which showed prices rose 0.2% on a monthly basis and 2.5% from the prior year.

Economists have noted that inflation data from December 2025 through April 2026 will be affected due to data collection interruptions resulting from last fall’s 43-day government shutdown.

During the shutdown, the BLS wasn’t able to gather data and used a carry-forward methodology to make up for the lack of an October CPI report and missing data in November’s report. Economists say this is likely to impart a downward bias on inflation data until this spring, when fresh data will negate the discrepancy.

The cost of living breakdown

High inflation has created severe financial pressures in recent years for most U.S. households, which are forced to pay more for everyday necessities like food and rent. Price hikes are particularly difficult for lower-income Americans, because they tend to spend more of their already-stretched paychecks on necessities and have less flexibility to save.