US inflation slowed more than forecast in March, pulled lower by falling gasoline prices and slowing shelter inflation, as the new US administration's tariff policies have prompted concerns of a global economic slowdown.

The consumer price index (CPI) slowed to an annual rate of 2.4pc in March, down from 2.8pc in February and the lowest rate since November 2024, the Labor Department reported Thursday. Analysts surveyed by Trading Economics had forecast a 2.6pc rate for March.

Core inflation, which strips out volatile food and energy, rose at a 2.8pc annual rate, down from a 3pc annual rate the prior month and the lowest since March 2021.

The deceleration in inflation came a month after President Donald Trump began to levy tariffs on imports from China and on steel, aluminum and automobiles, starting in February. Several tariff deadlines were pushed back, including a three-month pause enacted this week on much steeper tariffs for most countries. The tariffs have prompted companies and consumers to pull back on investments and some purchases while shaking up financial markets, and heightening concerns of a global recession.

The energy index fell by an annual 3.3pc in March following a 0.2pc annual decline in February. Gasoline fell by 9.8pc after a 3.1pc decline. Piped natural gas rose by 9.4pc.

Food rose by an annual 3pc, accelerating from 2.6pc. Eggs surged by an annual 60.4pc, as avian flu has slashed supply.

Shelter rose by an annual 4pc in March, slowing from 4.2pc in February and the smallest increase since November 2021.

Services less energy services rose by 3.7pc, slowing from 4.1pc in February.

New vehicles were unchanged after an annual 0.3pc drop in February.

Transportation services, which includes what maintenance and repair, insurance and airfares, rose by an annual 3.1pc, slowing from 6pc in February. Car insurance was up by an annual 7.5pc and airline fares fell by 5.2pc.

CPI fell by 0.1pc in March after a monthly 0.2pc gain in February. Core inflation rose by 0.1pc for the month.

By Bob Willis