#CPI&JoblessClaimsWatch In March 2025, U.S. consumer prices declined by 0.1%, marking the first drop in nearly five years, primarily due to lower gasoline and used vehicle costs. Year-over-year inflation eased to 2.4%, down from 2.8% in February, while core inflation rose 2.8%, the smallest annual increase since 2021 citeturn0search3. Despite this, inflation expectations surged, with the University of Michigan's index showing a 6.7% one-year outlook—the highest since 1981 citeturn0news12. Meanwhile, initial jobless claims increased slightly to 223,000, indicating a stable labor market amid trade tensions and economic uncertainties citeturn0search2. The Federal Reserve remains cautious, balancing inflation risks with potential economic slowdown.