#CPI&JoblessClaimsWatch

CPI & Jobless Claims Watch – April 2025

In March 2025, U.S. inflation showed signs of cooling, with the Consumer Price Index (CPI) falling by 0.1% month-over-month—marking the first decline in nearly five years. On an annual basis, CPI eased to 2.4%, down from 2.8% in February. This decrease was largely driven by falling energy prices, especially gasoline. However, core CPI, which strips out food and energy, remained firm at 2.8% year-over-year, reflecting ongoing price pressures in housing and services.

At the same time, jobless claims remained relatively stable. Initial claims for unemployment benefits rose slightly by 4,000 to 223,000 for the week ending April 5. Despite the increase, claims have held within a tight range, indicating a steady labor market. Continuing claims dropped by 43,000 to 1.85 million, suggesting people are finding jobs at a healthy pace.

While the latest CPI data offers some relief on the inflation front, economists warn of potential challenges ahead. New tariffs on Chinese imports, including a steep 125% duty, could reignite price pressures in coming months. The Federal Reserve now faces a complex balancing act as it weighs slowing inflation against the risk of trade-driven economic headwinds.