April core CPI climbed 0.4% month-over-month, exceeding forecasts and lifting annual inflation to 2.8%.
US consumer prices accelerated in April, with core CPI rising 0.4% month-over-month, above the 0.3% estimate, pushing the annual rate to 2.8% from 2.6%. Headline CPI matched expectations at 0.6% m/m, but shelter and services inflation reaccelerated, raising concerns over persistent price pressures.
The April print follows a 0.4% core CPI increase in March and a 3.5% annual rate. Economists had anticipated a slight cooling in inflation, but services and shelter costs drove the upside surprise, complicating the Federal Reserve’s policy outlook.
Markets reacted with a rotation out of momentum stocks and into industrials, while Treasury yields rose after the $42 billion 10-year note auction priced at a 4.468% yield. Crude oil settled at $102.18, up $4.11 on the session.