Inflation remained high in April

A key measure of consumer prices surged ahead in April, diminishing hopes that inflation will fade in the near future.

Driving the news: The Consumer Price Index rose 0.3% in April and was up 8.3% from a year earlier, the Labor Department said Wednesday. The previous year-over-year inflation had been 8.5%.

• But more worrying, "core inflation," which excludes volatile food and energy, surged ahead 0.6% in April. That number had risen only 0.3% in March, and investors and economists are watching it closely for signs of underlying inflation trends.

The details: The hot core inflation number was driven by a rise in services excluding energy, which was up 0.7%. The spreading of inflation pressures away from goods and into services is a worrying sign.

• Prices rose 0.6% for rents; 0.5% for medical services; and 3.1% for transportation services.

The new numbers come as President Biden pledges to make fighting inflation his "top domestic priority" and the Federal Reserve embarks on a period of rapid interest rate increases meant to quash price pressures.

Many economists believe that March will turn out to be the peak in year-over-year inflation measures, and that price pressures will diminish gradually from here. The new April numbers though show that underlying inflation pressures remain very much alive.

What they're saying: "While it is heartening to see that annual inflation moderated in April, the fact remains that inflation is unacceptably high," President Biden said in a statement.

• "As I said yesterday, inflation is a challenge for families across the country and bringing it down is my top economic priority," he added.
• Biden said at a Chicago fund-raiser later on Wednesday that inflation "is going to scare the hell out of everybody," adding: "We're making progress, but there's a long way to go."

Editor's note: This article has been updated to include Biden's statement and comments at the Chicago fund-raiser.