War Impacts Drive Cleveland Fed Inflation Nowcasts Higher

The conflict in the Middle East, which has driven a sharp rise in energy prices and roiled critical supply chains, is on track to impact headline inflation in the United States. According to updated data from the Federal Reserve Bank of Cleveland, while headline inflation is expected to rise, underlying price pressures remain more contained. The bank’s inflation nowcasts, which are updated daily to project real-time economic shifts, show that the year-over-year consumer price index (CPI) for April is projected to reach 3.71%, up from the 3.25% nowcast recorded in March.