The U.S. Consumer Price Index (CPI) for March 2025 has declined to 2.4%, marking its lowest level since October 2024 and down from 2.8% in February.
This marks the lowest annual inflation reading since October 2023 and highlights a notable pullback in price pressures across key sectors.
On a monthly basis, the CPI declined 0.1%, the first such drop since late 2023. The core CPI — which excludes food and energy — rose just 0.1% for the month and increased 2.8% over the past year, its smallest 12-month gain since March 2021.
Key Highlights:
- Energy Prices: The energy index fell 2.4% in March, driven by a sharp 6.3% drop in gasoline prices, which more than offset gains in electricity and natural gas.
- Food Prices: The food index rose 0.4% in March. Food at home climbed 0.5%, while food away from home increased 0.4%.
- Shelter Costs: The shelter index — a key driver of inflation in recent years — increased by 0.4% over the month, remaining one of the largest contributors to overall inflation.
The recent implementation of sweeping tariffs by President Donald Trump, including a 125% duty on Chinese imports, has raised concerns about potential inflationary pressures in the coming months. Economists warn that these tariffs could lead to increased production costs and higher consumer prices, potentially offsetting the current easing of inflation.
Federal Reserve officials are closely monitoring these developments. St. Louis Fed President Alberto Musalem indicated that while current growth projections have dipped below the 2% trend, the central bank remains vigilant and may adjust monetary policy to balance inflation and employment objectives.
Financial markets have responded cautiously to the CPI data and ongoing trade tensions. The S&P 500, Dow Jones Industrial Average, and Nasdaq Composite have all experienced a significant surge yesterday. Today we can see major volatility in the futures markets as investors weigh the potential impact of tariffs on corporate earnings and economic growth.
Alexander Stefanov
Reporter at Coindoo
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over 8 years of experience covering the crypto, blockchain and fintech industries, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics.
Source: https://coindoo.com/u-s-inflation-eases-again-but-will-tariffs-reverse-the-trend/