The Fed's preferred inflation gauge, core PCE, rose 3.3% annually in April, up from 3.2% in March and well above the Fed's mythical 2% target. Headline PCE inflation accelerated to 3.8%, the highest level in roughly three years.

The government and mainstream economists will immediately try to calm everyone by saying the monthly core increase was "only" 0.2%. They are playing games with statistics because they know the public is scared. The reality is that inflation has remained above target for over five years straight while wages continue failing to keep pace with real living costs. The average person does not care about seasonal adjustments or revised models. They care that groceries, gasoline, insurance, rent, electricity, and debt servicing costs continue rising together.

Energy remains the key. Gasoline prices jumped 12.3% in April alone and are now reportedly more than 50% higher than late February as the Iran conflict disrupted shipping routes, insurance markets, and energy supply chains tied to the Strait of Hormuz. The Fed cannot print oil. It cannot lower geopolitical risk with interest rates. Central bankers are trapped because war-driven inflation behaves very differently from ordinary business cycle inflation.