Consumer Prices Rose 8.5% In March, Slightly Hotter Than Expected And The Highest Since 1981

• Prices that consumers pay for everyday items surged in March to their highest levels since the early days of the Reagan administration, according to Labour Department data released Tuesday. 
• The consumer price index, which measures a wide-ranging basket of goods and services, jumped 8.5% from a year ago on an unadjusted basis, above even the already elevated Dow Jones estimate for 8.4%. 
• Excluding food and energy, so-called core CPI increased 6.5% on a 12-month basis, in line with the expectation. However, there were signs that core inflation appeared to be ebbing, as it rose just 0.3% for the month, less than the 0.5% estimate. That in turn sparked some hope that inflation overall was easing and that March might represent the peak. Markets reacted positively to the report as stocks rose and government bond yields declined. 
• To combat inflation, the Fed has begun raising interest rates and is expected to continue doing so through the remainder of the year and into 2023. The last time prices were this high, the Fed raised its benchmark rate to nearly 20%, pulling the economy into a recession that finally defeated inflation.

(Source: CNBC News)