The Consumer Price Index (CPI) rose 2.4% over the past 12 months, according to the latest data from the Bureau of Labor Statistics.¹ That’s down from February’s 2.8% rate and lower than the 2.6% economists had forecast.² The biggest contributor to the slowdown? Gasoline, which fell 6.3% in March and is now 9.8% lower than it was a year ago. The broader energy index also declined — down 2.4% from February and 3.3% compared to last March.

Impact of gas prices

For consumers, lower gas prices arrive at an opportune moment. Fuel costs touch nearly every part of the economy, from transportation, to shipping, to retail.³ When energy becomes more affordable, it can free up space in household budgets, especially for families facing higher prices in other areas.

Core inflation — which excludes food and energy — ticked up 0.1% from February and rose 2.8% over the past year.⁴ That was below the projected 3% rate and marked the smallest annual gain since March 2021.⁵

While housing and services continue to drive steady price growth, the drop in gas prices helped push the overall inflation rate into negative monthly territory, with the CPI edging down 0.1% between February and March.⁶

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Major appliances, bicycle and TV prices down

Several consumer goods saw notable price declines.⁷ Major appliances fell 1.8% month-over-month and are down 5.9% from last year. Dishes and flatware dropped 1.7% in March and are now 10.8% below where they were a year ago. TV prices have slid 9% year over year (YoY), and sports vehicles, including bicycles, are 7% lower. Smartphones have seen one of the largest annual declines, down 13.9%.

For anyone eyeing summer travel, there's positive movement.⁸ Public transportation costs fell 4.2% since February and 3.5% YoY. Airline fares dropped 5.3% last month and are 5.2% lower than last year. Car and truck rental rates are down 2.7% from February and 8.7% versus the past year. Lodging away from home, including hotels and motels, decreased 4.3% last month and is now 3.7% below year-ago levels.

New vehicle prices nudged up 0.1% in March compared to February, while used cars and trucks declined by 0.7%.⁹

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Food costs continue to rise

Grocery prices continued their gradual rise, with food overall increasing 0.4% in March and 3% on an annual basis.¹⁰ Food at home is up 2.4% over the past year, before seasonal adjustment. Within that category, the meats, poultry, fish, and eggs index jumped 7.9%, led by eggs, which spiked 60.4% compared to last March and 5.9% in just one month.

Outside of eggs, uncooked ground beef saw the sharpest increase from February, rising 3.1%, and is now 10.4% higher than a year ago.¹¹ Coffee prices rose 0.9% last month and are up 6.7% YoY, with instant coffee seeing the largest increase in the category — 13.2% over the past 12 months.¹²