U.S. inflation reaches a three‑year high as the Commerce Department reports the Personal Consumption Expenditures price index is up 4.1% year‑over‑year, with monthly inflation at 0.4%.Rising gasoline prices and higher costs for semiconductors and computer equipment tied to artificial intelligence demand are the main drivers, and oil costs eased from peaks near $4.50 per gallon to about $3.92 after a preliminary peace agreement signed by Donald Trump and Masoud Pezeshkian reopened shipping lanes.The Fed is holding its policy rate at 3.50%–3.75% and Chair Kevin Warsh reiterates a commitment to return inflation to 2% but offers no detailed path, prompting markets and some economists to expect a rate increase later this year.The surge in prices pressures the
stock market, erodes household savings as wages lag, and increases political risk for President
Donald Trump ahead of the midterm elections.