NAHB: Inflation Eased Again in April
In April 2025, U.S. inflation continued its downward trend, with the Consumer Price Index (CPI) rising by 0.2% month-over-month and 2.3% year-over-year—the smallest annual increase since February 2021. Core CPI, which excludes food and energy, also increased by 0.2% monthly and 2.8% annually. Shelter costs, a significant component of core inflation, rose by 0.3% in April and 4.0% over the past year, remaining the largest contributor to overall inflation. Other notable monthly increases included household furnishings (+1.0%), medical care (+0.5%), and motor vehicle insurance (+0.6%), while airline fares (-2.8%) and used cars and trucks (-0.5%) saw declines.
Despite the moderation in inflation, economists caution that recent tariff implementations, particularly those affecting Chinese imports, may exert upward pressure on prices in the coming months. While some tariffs have been temporarily paused, many remain in effect, and their full impact has yet to materialize in consumer prices. The Federal Reserve has maintained its current interest rate stance, adopting a cautious “wait and see” approach amid these uncertainties. Analysts anticipate that the Fed will closely monitor incoming data to assess the broader economic repercussions of the trade policies before making any policy adjustments.
