U.S. Inflation Surges to Two-Year High on Energy Shock; Consumer Sentiment Hits Historic Low
U.S. consumer prices jumped 3.3% year-over-year in March—the biggest increase since May 2024—driven by war-related energy price spikes. Meanwhile, consumer sentiment plunged to an all-time low as households worry about purchasing power.
Inflation Spike
The consumer price index was up 3.3% from a year earlier—the biggest increase since May 2024. Prices were up 0.9% from the previous month—the biggest monthly increase since June 2022.
Consumer Sentiment Crisis
In April, the Michigan Consumer Sentiment Index recorded its lowest reading in history. Consumer sentiment recorded a preliminary value of 47.6 in April 2026, the lowest reading in history, as the Iran conflict drove oil prices higher.
Economic Growth Risk
Forecasts from the Federal Reserve Bank of Atlanta show annualized GDP growth is trending toward 1.3% in Q1 2026, well below the 10-year average of 2.7%. The rise in energy prices almost completely wiped out any gain in real (inflation-adjusted) purchasing power for workers.