US inflation hit a three-year high of 4.2% in May, as the Iran war drove up energy prices. Core inflation, removing energy and food prices, inched up to 2.9%.

“The frustration for many Americans is that so many of the basics are up in price right now,” an economist told CNBC, adding that ending the Iran war would ease inflation, but that food prices would continue to rise.

The data bolsters the case for the US Federal Reserve to raise interest rates, pressuring Fed chair Kevin Warsh to weigh a hike against President Donald Trump’s demand to slash rates. Markets, however, expect the Fed to hold steady next week in the first meeting chaired by Warsh.