Markets are looking forward to the March US CPI data, which is expected to show an increase in inflation after oil prices rose following the outbreak of the Iran conflict. The March 2026 CPI data are scheduled to be released by the U.S. Bureau of Labor Statistics on April 10, 2026, at 8:30 A.M. Eastern Time.
Economists surveyed by Bloomberg project a March headline inflation rate of 3.4% year-over-year and 0.9% month-over-month, marking a sharp rise from February’s 2.4% annual increase and 0.3% monthly rise. If these expectations hold, March could post the largest monthly gain since June 2022.
The only silver lining could be the core inflation figures. On a core basis, excluding food and energy, prices are expected to rise by 0.3% from February and 2.7% annually.
A word of caution. March US CPI data may not reveal the full picture as price increases take 6-8 weeks to have a noticeable impact. Therefore, more than the March data, it will be the April data on US CPI that will determine how much of the price rise has permeated into the economy because of the Iran war.
Goldman Sachs economists forecast that tariffs will likely continue to slightly increase monthly inflation in the coming months, affecting categories such as recreation and household furnishings.
Despite a new ceasefire in the Iran war, concerns are growing that consumers and businesses may not view the inflation surge as a temporary issue. While markets perceive the current price shock as temporary, near-term inflation risks still exist.
The Federal Reserve is monitoring inflation expectations and may struggle to achieve its 2% target. Most Fed officials believe that achieving the 2% target may be slower than previously anticipated, as indicated in the minutes from their mid-March meeting.
“While the Fed remains ‘stuck’ with no immediate room to lower rates due to unanchored inflation risks, its hard-won stability is being systematically undone by the President’s aggressive geopolitical maneuvers,” says Naeem Aslam CIO Zaye Capital Markets.
The fear mirrors the 1970s, when persistent inflation was curtailed by the Federal Reserve’s drastic measure of imposing nearly 20% interest rates, which severely impacted the economy.
“February prices were in line but income was weak and GDP was revised down again. That means stagflation was a little worse than expected even before the Iran war started. Parallels to the 1970s might be growing as investors assess this fragile ceasefire,” says David Russell, Global Head of Market Strategy at TradeStation.
Meanwhile, markets are hopeful for an early resolution with all three major indexes posting a second straight week of gains. Jeff Buchbinder, Chief Equity Strategist for LPL Financial, says, “Stocks clearly want to move past this conflict and go higher. Strong fundamentals can shine through when geopolitical clouds clear.”
Despite the newly agreed-upon ceasefire in the Iran war, the inflationary risks are rising as markets do not expect the inflation spike to be temporary. Some analysts believe that oil prices could fall to earlier levels as war fears subside.
Jeffrey Roach, Chief Economist for LPL Financial, shares a cautionary note, “Investors will cheer the improvement in energy supply, which will ease pricing pressure. However, we cannot ignore the lingering second-order effects on the global economy so investors should continue to watch how geopolitical risks may affect wholesale prices, growth, and financing conditions. We should still expect inflation to run a bit hotter this month, but the outlook has clearly improved with this ceasefire.”
In March 2026, the US economy saw the creation of 178,000 jobs, the largest increase since December 2024, while the unemployment rate fell to 4.3%, down from 4.4% in February and below market expectations. The inflation remains sticky and unpredictable for the months ahead.
In this backdrop, the US Federal Reserve’s decisions on interest rates—whether to cut, raise, or maintain rates between 3.5% to 3.75%—are critical concerns for global market investors. We will see what Powell has to say in the next FOMC meeting on April 28-29.
Disclaimer: This article provides factual analysis only and is not, and should not be construed as, an offer, solicitation, or recommendation to buy or sell securities. Investment in foreign securities involves significant risks, including currency fluctuations, different financial reporting standards, and varying regulatory environments. The historical performance of US stocks is not a guarantee of future returns, and gains should not be viewed as an offer or solicitation to buy. Investors must conduct their own independent due diligence and seek advice from a SEBI-registered financial advisor.