U.S. CPI Rises 3.8% in April as Gasoline Surges
U.S. consumer inflation rose 3.8% year-over-year in April 2026, driven by a 28.4% jump in gasoline and a 17.9% increase in energy costs.
The Bureau of Labor Statistics reported on May 12 that U.S. consumer inflation rose 3.8% year-over-year in April 2026, the second consecutive monthly increase in the headline Consumer Price Index. The seasonally adjusted all-items CPI-U rose 0.6% in April after a 0.9% gain in March. On the 1982-84 base, the unadjusted index stood at 333.020, up 0.9% from March.
Energy was the main driver of the headline increase. The energy index climbed 17.9% over the past 12 months and added 3.8% in April on a seasonally adjusted basis. Gasoline rose 28.4% year-over-year and fuel oil increased 54.3% annually. BLS data and market analysts attributed higher fuel prices in part to the U.S.-Iran conflict and related oil supply disruptions.
Core inflation, which excludes food and energy, increased to 2.8% year-over-year from 2.6% in March and rose 0.4% month-over-month, above the 0.3% economists had expected. Shelter costs rose 0.6% in April and 3.3% over the past 12 months. Transportation services were 4.3% higher than a year ago, and medical care services climbed 3.2% annually. Prices for new vehicles, communications and some medical services fell, providing partial offsets.
Food prices increased 0.5% in April and 3.2% over the year. Food at home rose 2.9% year-over-year while food away from home climbed 3.6%. Meats, poultry, fish and eggs were up 1.3% for the month and fruits and vegetables gained 1.8%.
The hotter-than-expected CPI reading has shifted market expectations for monetary policy. Economists see a lower probability of a near-term Federal Reserve rate cut, with many projecting the first reduction in late 2026 or into 2027. Financial markets reacted to the report with a stronger U.S. dollar, declines in equities and bonds, and higher measures of expected volatility. Gasoline prices approaching or exceeding $4 a gallon in many areas have affected household budgets and curtailed some discretionary spending.
The next CPI report, covering May 2026 data, is scheduled for mid-June.
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