Consumer prices rose faster than expected in April, with inflation climbing 0.6% for the month and 3.8% over the past year, driven largely by surging energy and gasoline costs.

Core inflation, which excludes food and energy, also remained elevated at 2.8%, well above the Federal Reserve’s 2% target.

Rising costs in housing, airfare, and other tariff-sensitive goods added to inflation pressures, while wages failed to keep pace, leaving workers with declining real earnings.

The report fueled concerns in financial markets, raising expectations that the Federal Reserve may need to keep interest rates high or potentially consider hikes later this year, CNBC has reported.

Despite inflation pressures, the broader economy has shown resilience, supported by steady consumer spending, strong corporate earnings, and moderate economic growth forecasts.