Prices rose 5 percent in the year ending in March, down from the 6 percent inflation rate in February and the smallest 12-month increase since May 2021, according to new data released Wednesday by the Bureau of Labor Statistics.

March prices rose 0.1 percent compared to February prices, driven by steep rent costs. Falling energy prices have helped lower overall inflation but “core inflation,” which excludes food and energy, rose 5.6 percent since March 2022 after months of declines — the first acceleration since September.

Stock prices initially spiked at the news of the inflation report but soon leveled out. The Dow Jones industrial average, S&P 500 and Nasdaq composite were all flat by midday, the Washington Post reported.

Despite a 3.5 percent drop in the energy index, housing costs more than made up for it with the greatest contribution by far to the monthly price increase in March. Rents rose 0.5 percent in March — a slower pace than in February.

Price increases also showed up in March in auto insurance (up 1.2 percent), airfares (4 percent), household furnishings (0.4 percent) and new vehicles (0.4 percent).

Energy costs were down significantly from a year ago when Russia invaded Ukraine and sent global energy markets reeling. That pushed the overall inflation number down a full percentage point. The average price of gas has fallen after skyrocketing past $5 a gallon in 2022, but that could change soon. Saudi Arabia and other oil producers said they would cut output by more than 1 million barrels a day starting in May.

“The details of the report underlined that inflation retains concerning staying power under the surface,” Jeanna Smialek wrote for the New York Times. “The mixed signals in the fresh inflation data … come at a challenging economic moment for the Federal Reserve.”

The government’s No. 1 inflation fighter, the Fed has been trying to control price increases and slow down the economy for more than a year, raising interest rates from near zero in March 2022 to nearly 5 percent.

Inflation peaked at around 9 percent in the summer of 2022 and its pace has come down, but slowly. The Fed is trying to figure out how much more it must do to get back to the 2 percent inflation that was normal before the covid pandemic.

Bank failures in March raised new questions about how higher interest rates and borrowing costs could hurt the financial system and whether banks are ready for persistently high rates.

Any repercussions from the banking crisis weren’t expected to show up in the March inflation report, Rachel Siegel wrote for the Washington Post. “But Fed officials do believe the bank failures will eventually slow the economy down by tightening credit conditions in ways that mimic interest rate hikes — as banks become more risk-averse, they’ll issue fewer loans.”

The Fed’s next policy announcement is expected on May 3. President Biden said the CPI report was encouraging but also said the government must do more to slow inflation.

“Bottom line is that it doesn’t change things too much,” said Michael Pond, an interest rate analyst at Barclays, New York Times reported.