US inflation jumps to highest level in almost two years

Inflation in the US accelerated last month to its highest rate in nearly two years, as higher oil prices triggered by the US-Israel war in Iran started to spill over into the wider economy.

Consumer prices climbed 3.3% over the 12 months to March, picking up from 2.4% in February, the Labor Department said.

The jump, which was expected, marked one of the the biggest monthly changes since 2022, when the world was dealing with an energy shock brought on by Russia’s invasion of Ukraine.

Last month's increase was driven by a surge in prices at the pump, as the war’s shutdown of the Strait of Hormuz sent oil prices soaring, according to the report.

Gas prices rose 21.2% from February to March - the biggest monthly increase since the government started tracking the figures in 1967. Prices for fuel oil jumped more than 30% in the biggest surge since February 2000.

The impact has been particularly visible in states such as California, where gas prices were already higher than the rest of the US.

On Thursday, the average cost of a gallon of gas in California was $5.93, compared to the nationwide average of $4.16, according to the American Automobile Association.

Annel Villegas, 23, said the cost was "terrible", using an expletive for emphasis.

"I drive a truck, so I fill it up every half tank, and now it's like, $70 (£52), $80," she said, adding that she had tried to limit her driving as much as possible due to the jump in gas prices.

Still, she said: "I have to do what I have to do to live .... I'm just dealing with whatever it brings to me – so, paying more."

Reporting contributing by Kayla Epstein