US Inflation Hits 3.8% as Iran War Drives Energy Prices
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- US inflation rose to 3.8% in April, the fastest increase since May 2023 and the highest level since a 4% three years ago.
- Gasoline averaged $4.50 per gallon in April, the highest national price since July 2022.
- Strait of Hormuz was effectively closed due to the Iran war, pushing oil prices up and driving the surge in US energy costs.
- Federal Reserve is unlikely to cut interest rates this year, with possible hikes on the table as inflation climbs.
- Donald Trump called the inflation rise "short‑term" and emphasized keeping Iran from developing a nuclear weapon as his priority.
Why it matters: American consumers face higher gasoline and travel costs; the Fed may keep rates high, tightening credit; Trump's inflation narrative risks losing voter support ahead of the midterms.
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