US Inflation Poised to Surge as Iran War Fuels Energy Prices

The annual inflation rate in the US likely jumped to 3.3% in March 2026, marking the highest level since May 2024 and a sharp increase from 2.4% in February. The rise was primarily driven by higher energy costs linked to the war with Iran, alongside the continued pass-through of tariffs into consumer prices. On a monthly basis, consumer prices are estimated to have risen 0.9%, the largest increase since June 2022, following a 0.3% gain in February. The jump comes as the US national average price of gasoline climbed above $4 per gallon for the first time in more than three years. Meanwhile, core inflation which excludes food and energy, is also expected to have picked up, though more moderately, to 2.7% year over year, the highest in five months, up from 2.5% in both January and February. On a monthly basis, core consumer prices likely increased by 0.3%, compared to 0.2% in February.

The annual inflation rate in the US held steady at 2.4% in February 2026, unchanged from January, in line with expectations and remaining at its lowest level since May 2025. Energy prices rebounded (0.5% vs -0.1%), led by a smaller decline in gasoline (-5.6% vs -7.5%) and a rise in fuel oil (6.2% vs -4.2%) and natural gas (10.9% vs 9.8%). On the other hand, prices for used cars and trucks declined more (-3.2% vs -2%) while inflation steadied for food (3.1% vs 3.1%) and shelter (3% vs 3%). On a monthly basis, the CPI rose by 0.3%, slightly accelerating from 0.2% in January and in line with forecasts. Shelter prices were up 0.2% and made the largest contribution. Gasoline went up 0.8% and food rose 0.4%. Meanwhile, annual core inflation, which excludes food and energy, remained unchanged at 2.5%, the same as in January and near its lowest level since 2021. On a monthly basis, core CPI increased by 0.2%, less than 0.3% in the previous month. Core figures also matched expectations.

The annual inflation rate in the US likely held steady at 2.4% in February 2026, unchanged from January and remaining at its lowest level since May 2025. On a monthly basis, the CPI is estimated to have risen by 0.3%, slightly accelerating from 0.2% in January. Gasoline prices probably picked up while prices for services, food, and housing are expected to have slowed, and used vehicle prices likely remained lower. Meanwhile, annual core inflation, which excludes food and energy, is projected to have remained unchanged at 2.5%, the same as in January and near its lowest level since 2021. On a monthly basis, core CPI is expected to have increased by 0.2%, less than 0.3% in the previous month. Overall, the February CPI report is expected to continue pointing to inflation slightly above the Federal Reserve’s target, while also suggesting a degree of stabilisation, partly reflecting base effects as stronger readings from a year earlier drop out of the annual calculation.