Inflation increased 2.3% in April, tariff impact not yet visible

The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.2% on a seasonally adjusted basis in April, after falling 0.1% in March, the U.S. Bureau of Labor Statistics reported Tuesday. In the last 12 months of observation, the “all items index” increased 2.3% before seasonal adjustment. 

“Headline and core inflation rose less than expected in April, with headline inflation declining to 2.3% year-over-year while core inflation remained steady at 2.8% compared to the previous month. The most notable increases in core prices came from services such as housing, medical care, insurance, and education indicating impact from goods tariff is not significant yet,” said America’s Credit Unions Senior Economist Dawit Kebede. “While the recent deal with China resulted in big reduction of tariffs, they remain sufficiently high to add pressure on prices and the economy. This will likely make the Federal Reserve wait to see more incoming data before taking action to cut rates.”