America In Focus: Hotter inflation doesn’t stop consumers, investors

In the past week, many Americans remained focused on the economy, inflation and how those forces could impact their lives. Trips to the grocery store or gas station are more painful than they were last year, and that is impacting the decisions of both households and businesses.

Here’s a snapshot of prominent economic data and news that occurred over the past week and what it potentially means for you.

U.S. consumer prices climbed sharply again last month as the 10-week war with Iran pushed energy prices higher.

The Labor Department’s consumer price index rose 3.8% from April 2025, according to data released Tuesday. On a month-to-month basis, April prices rose 0.6% from March as gasoline prices rose 5.4% during the month; the month-over-month gain was down from a 0.9% increase from February to March.

Labor Department figures showed that gasoline prices are up more than 28% compared to a year ago. AAA says the average gallon of gasoline costs motorists more than $4.50 a gallon, about 44% more than it cost last year at this time.

U.S. wholesale inflation came in hot last month. Producer prices rose 6% from a year earlier, the most since December 2022, as the 10-week Iran war pushed up energy prices and put pressure on companies to pass along higher costs to consumers.

The Labor Department reported Wednesday that its producer price index — which tracks inflation before it hits consumers — shot up 1.4% in April, the biggest monthly gain since March 2022.

Energy prices climbed 7.8% from March to April and 22.7% from a year earlier. Gasoline soared 15.6% from March and diesel, the dominant fuel used in shopping, jumped 12.6%.

Excluding volatile food and energy costs, so-called core producer prices were up 1% from March and 5.2% from April 2025.

All the numbers were much higher than economists had forecast.

The number of Americans filing for jobless aid rose last week but remains historically low despite the economic uncertainty caused by the war in Iran.

U.S. applications for unemployment benefits for the the week ending May 9 rose by 12,000 to 211,000, the Labor Department reported Thursday. That’s slightly more than the 207,000 new applications analysts surveyed by the data firm FactSet had forecast.

Weekly filings for unemployment benefits are considered a proxy for U.S. layoffs and are close to a real-time indicator of the health of the job market.

Despite relatively few layoffs, the labor market appears to be stuck in what economists call a “low-hire, low-fire” state. That has kept the unemployment rate low at 4.3%, but left many of those out of work struggling to find new employment.

Shoppers pulled back on spending in April as higher gas prices fueled by the Iran war meant less money left over for some nonessentials like clothing and furniture.

Retail sales rose a respectable 0.5% in April, but that was slower than the 1.6% growth seen in March, according to Commerce Department data released Thursday. March marked the largest one-month increase in retail spending in more than three years, largely because gas prices rose so rapidly.

Excluding gasoline, retail sales in April were up 0.3%. That’s less than half the 0.7% pace from the previous month, excluding gas station sales.

Sales of previously occupied U.S. homes were essentially flat in April, another lackluster showing for the housing market during what’s traditionally its busiest time of the year.

Existing home sales edged up 0.2% last month from March to a seasonally adjusted annual rate of 4.02 million units, the National Association of Realtors said Monday. Sales were unchanged compared to April last year.

The latest sales figure fell short of the roughly 4.12 million pace economists were expecting, according to FactSet.

Sales have been hovering close to a 4 million annual pace now going back to 2023, far short of the historic norm that is closer to 5.2 million.

The average long-term U.S. mortgage rate edged lower this week, its first drop after rising the previous two weeks.

The benchmark 30-year fixed rate mortgage rate fell to 6.36% from 6.37% last week, mortgage buyer Freddie Mac said Thursday. One year ago, the rate averaged 6.81%.

Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, also eased this week. That average rate fell to 5.71% from 5.72% last week. A year ago, it was at 5.92%, Freddie Mac said.

The U.S. stock market was falling from its records Friday and joining a worldwide stock market drop as higher oil prices sent a shiver through the bond market. Stocks that had been caught up in the euphoria around artificial-intelligence technology that rose sharply for most of the week, led the decline Friday.