“This marks the third consecutive strong reading and means that the stalled disinflationary narrative can no longer be called a blip,” said Seema Shah, chief global strategist at Principal Asset Management. “In fact, even if inflation were to cool next month to a more comfortable reading, there is likely sufficient caution within the Fed now to mean that a July cut may also be a stretch.”

With the economy still growing and adding jobs at a healthy clip, Fed Chair Jerome Powell doesn’t have to worry too much yet about causing an unnecessary recession and can hold borrowing costs high for the time being. But higher rates are an uncomfortable backdrop for Biden heading into his bid for reelection, as they squeeze credit card borrowers and would-be homebuyers, and also weigh on the stock market.

Continued stubbornness in inflation has been fed in particular by housing costs and rising gas prices, although a jump in auto insurance prices also contributed to the hotter-than-expected March CPI report.

Fed officials are still forecasting rate cuts later this year as they track real-time data suggesting inflation will continue to drift downward, but there’s no guarantee how quickly that disinflation will show up.

Data from sources like Apartment List suggests that rents have fallen significantly in the past year, but shelter costs continue to be one of the biggest drivers of higher inflation because it takes a while for new leases to feed into official inflation data. (Each unit is only surveyed every six months, and people renewing their leases might not see as big a shift as those who are moving.)

“There’s some confidence that the lower market rent increases that we’re seeing will show up in measures of housing services inflation over time,” Powell told reporters last month. “There’s a little bit of uncertainty about when that will happen, but there’s real confidence that they will show up eventually over time.”

Fed officials have also made clear that they’re hoping to see some softening in services inflation because wage growth has slowed, putting less pressure on labor-intensive industries like restaurants to keep raising prices.

So far, however, that narrative isn’t playing out, and progress toward the Fed’s 2 percent inflation target has slowed.

Still, that target is based on a separate measure of inflation, the personal consumption expenditures index, which stood at an annual rate of 2.5 percent in February. CPI is designed to measure out-of-pocket costs for consumers, while PCE is a broader measure of price pressures in the economy, including, for example, the cost of medical services paid for by employer-provided health insurance. PCE will be updated later this month.