Inflation Hits 3-Year High & Harvard Cracks Down on A Grades

The Morning Brew Daily episode recaps key economic pressures from surging US inflation, alongside Harvard's bid to curb grade inflation, courtroom drama in the OpenAI lawsuit, and scattered business updates like supply chain quirks from the war in Iran and corporate rejections.

US Inflation Accelerates

April's consumer price index rose 3.8% year-over-year, the fastest pace in three years and up from 3.3% in March, driven mainly by energy costs tied to the war in Iran that began late February. Core inflation, excluding food and energy, hit 2.8%—its largest monthly jump since September—signaling broader price pressures filtering through sectors like airfares, up 21% from spiking jet fuel. Food prices climbed 3.2% overall, with tomatoes up nearly 30% yearly due to a 17% tariff on Mexican imports (90% of supply), plus higher fertilizer, diesel, packaging, and transport costs—all amplified by tariffs or the war. Coffee rose 19%, fresh vegetables 12%, and beef reflects record-low cattle herds in 75 years. Wages grew 3.6% over the past year, leaving real earnings negative for the first time in three years as inflation outpaces gains. This erodes household budgets and boosts inflation expectations, potentially spurring wage demands and a self-fulfilling price spiral. The White House faces credibility strain after promising lower costs, while incoming Fed Chair Kevin Wars navigates