• Macro Notes
  • Posts
  • Gas Lit The CPI, And The Fed Just Lost Its Easy Excuse

Gas Lit The CPI, And The Fed Just Lost Its Easy Excuse

March CPI hit 3.3%, gas did the shouting, and real wages took a hit. Here’s the smarter play.

April 15, 2026

March inflation came in hot enough to wreck the all-clear narrative, but not hot enough to tell one simple story.

Gasoline did most of the yelling, core inflation was a little less ugly, and now the real question is not whether prices spiked. They did.

The real question is which costs stick around long enough to squeeze consumers, pressure margins, and keep the Fed glued to its chair.

Big Transition (Sponsored)

A major White House tech summit recently underscored how near-term the AI shift may really be.

With global leaders, technology executives, and even a humanoid robot in attendance, the event reflected how serious this transition has become.

AI is no longer just a future trend to watch, it is increasingly becoming part of education, business, and the broader economy.

While these changes may bring disruption, history shows that transformational periods can also reward investors who understand where things are heading.

Discover The Opportunity Now

(By clicking here, you will be subscribed to receive emails from Porter’s Daily Journal. Porter’s Daily Journal is read by 50,000 of the world’s best-informed investors.)

The Headline Was Loud

Consumer prices rose 3.3% year over year in March, up sharply from 2.4% in February and the hottest reading in two years. Core inflation rose 2.6%, which was slightly better than feared, but still not exactly a victory lap.

Gas Did Most Of The Damage

The biggest villain was energy. Energy prices jumped 12.5% from a year earlier, with gasoline up 18.9% and fuel oil up 44.2%.

That fed straight into transportation services, which rose 4.1% year over year.

This is what makes energy shocks so annoying: they do not stay in the gas station. They hitch a ride through shipping, delivery, travel, and all the other costs companies eventually try to pass along.

Trivia: When did the U.S. government last run a federal budget surplus?

Login or Subscribe to participate in polls.

Beyond Headlines (Sponsored)

Oil has moved above $100 a barrel as tensions in the Middle East continue to reshape expectations across global energy markets.

While daily headlines can drive sharp swings, the bigger story may be what higher crude prices mean for select energy companies with strong cash flow and operating leverage.

Zacks has outlined three oil stocks that may be well positioned if elevated prices persist.

Read the report.

Not Every Category Looked Bad

The internals were less one-note than the headline.

  • Used-car prices fell 3.2%

  • Groceries cooled a bit compared with February

  • Shelter inflation held at 3.0% instead of reaccelerating

That is the good news. The bad news is that a bunch of other categories still looked sticky or got worse. Apparel inflation sped up to 3.4%, and airline fares surged 14.9% year over year.

Early Moves (Sponsored)

The conflict in Iran isn’t slowing down—it’s intensifying.

Ongoing strikes and pressure on global oil routes are already pushing gas prices higher, with analysts warning of broader economic impact if disruptions continue.

That kind of instability can affect portfolios tied to traditional assets. It’s why many investors look to physical gold as a way to help protect their savings during uncertain times.

Red State Gold Group’s FREE Gold IRA Guide shows how eligible IRA or 401(k) funds can be rolled into physical gold and silver.

Get your free guide today

Or call (888) 711-2433 for more information.

The Real Wage Problem

The report also came with a very real consumer-income problem. Average weekly earnings fell 0.9% in March from February after inflation, and were up only 0.2% from a year earlier.

That is the part that matters for spending.

Even if inflation does not spiral from here, higher prices are still chewing through household buying power faster than most people can comfortably absorb.

Why The Fed Still Can’t Relax

There is still no reason to sound the all-clear. The attached article notes that prices often go up quickly and come down slowly, especially after a shock like this.

On top of that, the ISM services prices index jumped to 70.7, the highest since October 2022, which suggests more companies are still paying up and will eventually push some of those costs onto customers.

That leaves the Fed stuck in the same awkward place: inflation is above target, the labor market is cooling, and cutting too aggressively makes the price problem harder to kill.

What This Means For You

So the right angle here is not broad market optimism or recession panic. It is selectivity.

You want businesses that can handle sticky inflation, pass through costs, and keep demand intact even when the average consumer feels a little poorer.

Actionable Stuff

Do Not Overread One Number

The inflation spike was real, but the internals were mixed, not universally ugly.

Favor Pricing Power With Necessity

Essential services and recurring demand still beat hopeful discretionary stories.

Watch Real Wages

If consumers feel poorer, spending behavior changes fast.

Look For Pass-Through Ability

The winners are the companies that can absorb or redirect cost pressure without wrecking volume.

Keep Rate-Cut Hope In The Background

The Fed just got another reason to wait.

Top Picks

TJX Companies (NYSE: TJX)

If apparel inflation is picking up while household buying power gets clipped, off-price retail starts looking even better. TJX benefits when consumers still want branded goods but feel less willing to pay full freight.

This is the kind of environment where shoppers trade down without feeling like they gave up, which is exactly the sweet spot for off-price.

What to watch: Traffic trends, merchandise margin, and whether apparel price pressure is pushing more shoppers toward value channels.

Republic Services (NYSE: RSG)

When fuel and transportation costs rise, route-based service businesses with pricing power tend to hold up better than most.

Republic can pass through inflation more effectively than fragile operators because trash collection is not optional and route density matters.

In a sticky-cost world, boring businesses with recurring contracts often start looking pretty smart.

What to watch: Pricing versus fuel and labor costs, margin resilience, and commentary on surcharge recovery.

O’Reilly Automotive (NASDAQ: ORLY)

Real wages barely growing is usually good news for repair-over-replace behavior. If consumers feel a little poorer and financing stays expensive, they tend to hold onto older vehicles longer.

That supports demand for maintenance and replacement parts. O’Reilly also operates in a category where urgency helps pricing.

When the car needs fixing, most people do not spend a week politely comparison-shopping.

What to watch: Same-store sales, professional versus DIY demand, and gross margin stability if transportation-related costs stay high.

HCA Healthcare (NYSE: HCA)

Hospital care was one of the services categories running hotter, which is a reminder that services inflation is still sticky in parts of the economy that consumers cannot easily avoid.

HCA is not a pure inflation trade, but it does sit in a category with durable demand, strong utilization, and pricing that tends to move more slowly but more persistently than goods.

If the inflation battle shifts from energy shock to sticky services, healthcare operators stay relevant.

What to watch: Admission trends, labor-cost management, and management commentary on pricing and payer mix.

Bottom Line

The Big Takeaway

March inflation was hot enough to keep the Fed uncomfortable and consumers irritated.

What Is Actually Driving It

Gas did most of the damage, but the bigger issue is that real wages got clipped and services inflation still refuses to fully behave.

How To Play It

That is not a great setup for broad risk-taking, but it is a good setup for companies with value appeal, recurring demand, and the ability to pass through costs without losing the customer.

That’s it for today’s edition—thanks for reading! Reply to this email with any feedback or let me know which macro trends or markets you’d like me to cover next.

Best Regards,
—Noah Zelvis
Macro Notes