Sharply rising gas and energy prices are expected to be the biggest contributor to March’s likely jump in inflation, Samuel Tombs, chief US economist at Pantheon Macroeconomics, told CNN.
Pantheon is expecting a 23% rise in gas prices, which would be the highest monthly increase on record for the index.
“There’s been bigger energy price shocks in total, but they’ve rippled through over several months,” he said. “This just came through in one month.”
If Pantheon’s math bears out, the increase in gas prices would account for more than two-thirds of the firm’s projected 1% monthly increase in the overall CPI.
“The energy price shock will take many months to play out to other parts of the economy,” Tombs said. “Goods prices won’t change immediately, but after three to six months, you tend to see energy price changes filter through to consumers.”