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US inflation rose to 3.5 per cent in March, surpassing expectations and marking the second increase in a row, as the Federal Reserve considers how long to keep interest rates at a 23-year high.
Wednesday’s figures for annual Consumer Price Index inflation compared with expectations of a 3.4 per cent rise, according to economists polled by Bloomberg.
CPI had risen to 3.2 per cent in February from 3.1 per cent in January.
The Bureau of Labor Statistics also said on Wednesday that core inflation, which excludes changes in food and energy costs, remained at 3.8 per cent.
Economists had expected a core rate for March of 3.7 per cent.
Following recent inflation and labour market data, traders in the futures market have cut their expectations of how many quarter-point interest rate cuts the Fed will make this year, from six or seven in January to two or three.
The benchmark federal funds target range is currently set at 5.25 to 5.5 per cent — the highest since 2001 — in a bid to rein in inflation.
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