The annual inflation rate has risen in the three months since the November election to 3%, with gasoline prices climbing despite Trump's claims that his return to the White House would signal increased oil production that would lower energy costs.
Wednesday's consumer price index report showed that inflation is punching back — and President Trump could end up facing the same challenges that dragged down his predecessor, President Joe Biden.
The yield on the 10-year Treasury note jumped Wednesday to 4.62% in response to the inflation report, a sign that investors expect interest rates, growth and inflation to be higher in the coming months.
For now, markets are anticipating more inflation as consumer demand stays strong and Trump has yet to show how exactly his policies would keep prices low, as he promised to voters.
On Wednesday, the president called for interest rate cuts, even though rate hikes by the Federal Reserve helped lower inflation that spiked at a four-decade high in 2022.
