INCREASING INFLATION

March CPI rose a staggering 0.9% M-o-M, the most since 6/22, and that commensurately reduced inflation-adjusted salaries by almost one percentage point. With Y-o-Y inflation up 3.3%, led by a 21.2% M-o-M rise in gasoline, inflation-adjusted salaries are up just 0.2% Y-o-Y! Quite positively, however, core inflation, which excludes food and energy, rose just 0.2% M-o-M and 2.6% Y-o-Y and service inflation was benign, suggesting no inflation flow-through, yet.