Inflation Research Brief

Record gas spike amid persistent tensions. The March CPI report captured the initial effect of the oil shock from the Strait of Hormuz closure, with the headline rate rising 0.9 percent month-over-month to 3.3 percent annually. Gasoline prices increased 21.2 percent on the month, the largest monthly gain since recordkeeping began in 1967. A two-week ceasefire announced earlier this month briefly eased oil prices, but talks between the U.S. and Iran stalled over the weekend, and Washington moved ahead with a blockade on traffic to and from Iranian ports. While the ceasefire has not fully collapsed, tanker traffic remains limited and oil prices have climbed back above $100 per barrel, leaving the outlook tied to whether energy flows normalize or disruption deepens. For now, pass-through into other consumer products remains minimal, with core CPI rising just 0.2 percent in March, though additional pressure could emerge in coming months.