Inflation report to be released as Iran war sends gas prices surging
An inflation report to be released on Wednesday will present the newest measure of value will increase as the US-Israeli war with Iran drives up gasoline prices and renewals considerations about affordability.
The contemporary knowledge — which is ready to element prices in February — will present the associated fee burden borne by households weeks earlier than the outbreak of war.
Economists count on prices to have elevated 2.4% in February from a yr earlier, which would depart the inflation charge unchanged from January. Inflation stands barely larger than the Federal Reserve’s goal charge of two%.
A lackluster jobs report final week showed the US economic system misplaced 92,000 jobs in February, which marked a reversal of fortunes for the labor market and erased many of the job good points recorded in 2026.
The unemployment charge ticked up from 4.3% in January to 4.4% in February, the BLS mentioned. Unemployment stays low by historic requirements.
Sluggish hiring has coincided with elevated inflation, threatening a interval of “stagflation.”
Those economic headwinds helped set the conditions before the outbreak of war with Iran, which spiked oil prices and risked price increases for a host of diesel-fuel transported goods.
US crude oil prices hovered at about $86 per barrel on Tuesday, surging more than 30% since a month earlier.
The common value of a gallon of gasoline within the US soared to $3.53 on Tuesday from $2.92 a month prior, AAA knowledge confirmed.
President Donald Trump speaks on the Republican Members Issues Conference, March 9, 2026, at Trump National Doral Miami in Doral, Fla.
Mark Schiefelbein/AP
Still, the overall economic picture remains mixed.
A government report in February on gross domestic product (GDP) showed the economy grew at a rapid annualized pace of 1.4% over the final three months of 2025. That reading indicated a dramatic cooldown from the strong annualized growth of 4.4% recorded in the previous quarter, US Commerce Department data showed.
The Iran war threatens to sluggish US financial development since oil-driven value will increase might weigh on shoppers and companies, analysts previously told ABCNews.
The potential combination of higher inflation and slower growth could also pose a challenge for the Fed, putting pressure on both sides of its dual mandate to manage prices and maintain maximum employment.
If the Fed opts to lower borrowing costs, it could spur growth but risk higher inflation. On the other hand, the choice to raise interest rates may slow price increases but risks a cooldown of economic performance.
The central financial institution held interest rates steady at its most up-to-date assembly in January, ending a string of three consecutive quarter-point charge cuts. Policymakers will make their subsequent interest-rate determination on March 18.
