WASHINGTON (AP) — U.S. consumer prices surged 0.8% in April, pushing the rise in inflation over the past year to the fastest rate in more than a decade, an acceleration that has stirred worries about its effect on the economy.
The Labor Department reported Wednesday that the price consumers pay for their purchases of everything from food and clothes to new cars rose at a faster pace than last month’s 0.6% rise.
“The pandemic caused a lot of people not to spend which caused a lot of businesses not to procure raw material commodities. Which when spending started and there’s a backlog of orders, backlog of inventory. That’s when things started to spike up again,” said Matt Sapaula, a money expert with PHP Agency Inc, a financial services marketing company.
Over the past 12 months, prices are up 4.2% — the fastest rise since a 4.9% gain in the 12 months ending in September 2008.
Excluding volatile food and energy, core inflation jumped 0.9% in April. Core prices are up a sharp 3% over the past 12 months.
Concerns about rising inflation sent stocks tumbling on Tuesday with the Dow Jones Industrial Average falling by more than 470 points or 1.4%, its worst day since Feb. 26.
The big April increase was led by a record 10% surge in the price for used cars and trucks.
The Associated Press contributed to this report.