April CPI rose 3.8% year-over-year, driven by energy and food prices, pressuring real wages amid stock market gains.
US consumer prices rose 3.8% year-over-year in April, the fastest pace since May 2023, up from 2.4% in January and February. The increase was led by a 3.8% monthly gain in energy prices, which contributed over 40% of the headline CPI rise, and a 0.5% increase in food prices.
The data suggests inflation may be stabilizing at higher levels than pre-pandemic norms, with 3% now appearing as a floor rather than a ceiling. Gasoline prices surged 28.4% from a year earlier, while grocery prices climbed 0.7% on the month.
Real average hourly earnings fell 0.3% year-over-year, highlighting a disconnect between wage growth and inflation. Economists noted wage gains have been concentrated among higher-income earners, leaving stocks decoupled from broader economic pressures.