Gas prices are seen at a gas station in Riverwoods, Ill., Monday, April 1, 2024. Inflation edged higher in March in another sign of elevated price pressures that have cast doubt on how soon the Federal Reserve may cut interest rates as high prices linger.according to the Labor Department
While food and energy prices are more volatile and stripped out of the gauges economists and the Fed watch to measure inflation, they are the most visible signs of prices to consumers at grocery stores and gas stations. Food prices only rose slightly in March, but the cost of gasoline was elevated and accounted for most of the rise in the CPI along with shelter.
The Federal Reserve is trying to engineer a soft landing, where they are able to bring inflation back to target without sending the economy into a recession. Its benchmark interest rate has been elevated since last year in an effort to cool economic activity and bring inflation down. Fed chair Jerome Powell has said the Fed is confident inflation is heading in the right direction but that they are not in a rush to cut rates because the economy is healthy despite a higher rate environment. Unemployment remains low and job growth has stayed strong despite the rate hikes.