U.S. April inflation rose to 3.8% on the Fed’s preferred measure, with energy prices cited as a key driver

Thursday, May 28, 2026Business & MarketsWell-covered3 frames

The Personal Consumption Expenditures price index rose 3.8% in April from a year earlier, up from 3.5% in March.
On a monthly basis, the PCE price index increased 0.4% in April after a 0.7% rise in March.
April’s 3.8% annual PCE reading was the highest since May 2023, making it the fastest pace in nearly three years.
Several reports attributed the rise in headline inflation largely to higher energy prices associated with the Iran conflict and related disruptions to oil shipping and supply chains.
Core PCE, which excludes food and energy, rose 3.3% from a year earlier in April.
Consumer spending continued to rise in April, but its growth slowed to 0.5% from 1.0% in March.
Households showed signs of strain in April: the personal saving rate fell to 2.6%, and inflation-adjusted disposable income declined for a third straight month.
Because inflation remains above the Federal Reserve’s 2% target, multiple reports said the data reinforced expectations that the Fed may keep interest rates unchanged or higher for longer.

How left and right are reading this

Both agree: Inflation’s April acceleration was real enough to tighten the squeeze on households and keep price pressures above the Fed’s comfort zone, even as spending growth slowed and reports tied much of the headline jump to higher energy costs.
They split on: Less a disagreement than a question of emphasis: the immediate hit to family budgets from energy-driven price increases, versus the policy consequence that stubborn inflation keeps the Fed on a higher-for-longer path.

The Personal Consumption Expenditures price index rose 3.8% in April from a year earlier, up from 3.5% in March.
On a monthly basis, the PCE price index increased 0.4% in April after a 0.7% rise in March.
April’s 3.8% annual PCE reading was the highest since May 2023, making it the fastest pace in nearly three years.
Several reports attributed the rise in headline inflation largely to higher energy prices associated with the Iran conflict and related disruptions to oil shipping and supply chains.
Core PCE, which excludes food and energy, rose 3.3% from a year earlier in April.
Consumer spending continued to rise in April, but its growth slowed to 0.5% from 1.0% in March.
Households showed signs of strain in April: the personal saving rate fell to 2.6%, and inflation-adjusted disposable income declined for a third straight month.
Because inflation remains above the Federal Reserve’s 2% target, multiple reports said the data reinforced expectations that the Fed may keep interest rates unchanged or higher for longer.