Inflation rises as energy prices soar due to Trump’s Iran war

U.S. inflation has climbed above 4 percent for the first time in three years as President Donald Trump's Iran war takes a toll on the wider economy.

The inflation rate rose 4.2 percent year-on-year in May, according to the latest government data, driven by soaring energy costs that have significantly impacted the cost-of living for working Americans, including at the gas pump, grocery store and in other consumer goods.

Inflation was at 2.4 percent before the war started February 28.

Some everyday items saw sizable increases in May, according to the Consumer Price Index, including energy and a number of grocery staples.

Gas prices rose 7 percent month on month - no relief for drivers who’ve seen prices at the pump soar more than 50 percent since the war started. The average gallon of gas in the U.S. now costs $4.15, according to AAA.

In the grocery store aisles, the prices of fresh biscuits, rolls and muffins were up 4.7 percent month on month, along with eggs (4 percent) and flour (2.6 percent).

Overall, food costs rose a modest 0.5 percent compared to April, and several categories ticked up less than that, including cereal and cookies. Prices fell for several staples, including meat, poultry fish and eggs (-0.2); bread (-0.7 percent); rice (-1.1 percent) and dairy products (-0.6 percent).

While there were some bright spots in Wednesday’s report, it may not be enough to lift consumer sentiment, which fell to an all-time low in April, according to the University of Michigan.

Shoppers are facing prices that are still much higher than they were a year ago, with double-digit increases for tomatoes (32 percent), lettuce (24.0 percent), instant coffee (24 percent) and beef and veal (12.9 percent).

Looking ahead, there may not be much relief at the gas station or grocery aisle. The United States launched a fresh round of attacks on Iran Tuesday night, with Trump saying Wednesday on Truth Social the Iranians have “taken too long to negotiate a deal that would have been great for them, now they will have to pay the price!!!”

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