US inflation came in hotter than expected dashing all hopes of a rate cut in March. The latest print showed core CPI (which excludes food and energy) at 3.9%, and headline CPI at 3.1% YoY, topping estimates of 3.7%, and 2.9% respectively. The surprise upshot was driven by increases in food, car insurance, medical care, and shelter, with shelter prices advancing the most. These readings from the US highlight the bumpy road ahead to bring inflation back to target and risks undermining the rosy narrative that markets had been pricing in. A scenario whereby inflation continues to moderate without tipping the economy into a recession. Personal consumption expenditure (PCE) figures i.e., the Fed’s preferred gauge of inflation is due later in the month and should provide more clues on the trajectory for inflation. Until then, markets are likely to be roiled with more volatility sending stocks lower and pushing bond yields higher.