Cost of conflict: US inflation hits 3-year high as Iran war fuels energy shock

US inflation hit a three-year high in May, soaring to 4.2% due to surging energy prices, particularly gasoline, driven by Middle East supply disruptions. This rise, the third consecutive monthly increase, pressures the Federal Reserve and poses a political challenge for the Trump administration ahead of midterm elections. Core inflation showed mixed signals, while energy costs are expected to cool.