Two halves of the economy are telling opposite stories. Anything tied to oil is soaring.
Anything you would borrow to buy is flat. Gas, plane tickets, and shipping keep climbing.
A house or a car has barely moved. That split is the whole story this month.
The Iran war began in late February. It has choked off oil moving through the Strait of Hormuz.
About a fifth of the world's oil passes through that narrow strip. Slow that lane down, and everyone waits.
Less supply means higher prices. So gas hit about $4.31 a gallon at the start of June.
That is up 38% from a year ago. All motor fuels are up about 41% over the same span.
Energy alone drove more than 60% of the month's price rise. Jet fuel jumped too, which dragged plane tickets higher.
A gallon of jet fuel cost about $3.23. That is up from $2.50 before the war.
Plane tickets are up about 27% over the year. At 4.2%, prices are rising about twice as fast as the Fed wants.
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Joe Seydl of J.P. Morgan Private Bank says oil stockpiles are getting thin. If the strait stays blocked, he sees oil near $140 a barrel by the fall.
That is up from about $93 today. Even if the fighting stops, traders may keep a safety premium on oil.
So the relief at the pump could be small. Mark Zandi of Moody's called inflation painfully high.
He thinks it is near a peak. But he warns it will not feel good for a long while.
The rest of the basket tells the opposite story. Prices for homes and cars have stayed flat.
Those two make up about half of what inflation tracks. But the reason is not good news.
People simply cannot afford to buy. That weak demand holds those prices down.
New car prices barely moved over the year. Used cars and trucks even fell about 2%.
A newer pressure is creeping in too. The AI build-out pulls hard on the power grid.
That has pushed power prices up about 6% in a year. So the squeeze is not just about oil.
Even a calm end to the war may not help fast. Traders tend to price in the next scare.
For now, the pump sets the mood. And the pump is still pricey.
Tariffs were the big worry a year ago. The Supreme Court struck down the core of that plan this year.
The White House has leaned on other tools since. One firm now pegs the average tariff rate near 9.7%.
That is only a touch above where it was. And Bank of America says most of that price pressure has passed.
That leaves the Iran war as the story that matters. Where oil goes from here, prices will likely follow.
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