March CPI Forecast: Prices May Hit Two-Year High

Economic forecasts indicate that the March Consumer Price Index report, scheduled for release at 8:30 a.m. ET on April 10, 2026, may show prices climbing at their fastest pace in nearly two years. According to an average of six separate forecasts reviewed by CBS News, March prices are expected to have risen at a 3.3% annual pace.

This projected increase represents a jump of nearly one percentage point from February 2026 and would mark the highest inflation rate since May 2024. The spike follows a period of relative cooling, as inflation had slowed to a 2.4% annual rate during January and February 2026, though that figure remained above the Federal Reserve’s 2% target.

Impact of the Iran War on Energy Costs

The anticipated rise in inflation is being driven primarily by higher energy prices linked to the ongoing conflict involving the U.S., Israel, and Iran. According to Pantheon Economics, the U.S. Has experienced the largest one-month jump in fuel costs since at least 1957.

Kiplinger reported on April 7, 2026, that the conflict has pushed oil prices to their highest level in four years, with gas prices soaring above $4.00 per gallon. Analysis from CEPR suggests that gas prices could jump nearly 20 percent, which would add approximately 0.6 percentage points to monthly inflation. This could result in the overall CPI reaching 1.0 to 1.1 percent for March.

The impact of the war on energy prices will push headline CPI inflation well above 3% in March and above 4% by April

Oxford Economics

Experts suggest that the inflationary pressures resulting from the conflict are likely to persist for several months. While a two-week ceasefire between the U.S. And Iran has occurred, analysts stated that Here’s unlikely to provide immediate relief to global energy shortages.

Broad Consumer Price Pressures

The increase in fuel costs is expected to create a ripple effect across various sectors due to higher production and transportation expenses. Economists refer to the tendency of energy prices to rise quickly during supply disruptions but fall more slowly after a crisis as the rockets and feathers principle.

Mark Zandi, chief economist at Moody’s Analytics, told CBS News that consumers will likely feel these effects throughout much of 2026. Zandi noted that there should be a bump in the cost of airline tickets and that grocery prices will probably increase due to the costs of transporting food from farms or ports to store shelves.

Additional pressures on food prices are being driven by higher import costs and previous wholesale increases, according to reporting from CEPR.

Economic Context and Purchasing Power

Inflation serves as a direct measure of consumer purchasing power, impacting how far a dollar stretches for individuals and affecting the profit margins of companies. This current volatility follows a long-term trend that peaked in June 2022, when the CPI hit a 40-year high of 9.1%.

The current trajectory suggests a potential reversal of the decelerating inflation trend observed in recent years. With the March CPI expected to show a sharp jump, We find growing concerns regarding the pressure this will place on the Federal Reserve’s monetary policy.