US inflation data for February recorded an increase of 0.3%, putting the annual rate at 2.4%. This report fully met analysts’ expectations and was the last reference point before the market began to feel the impact of the surge in oil prices due to the Iran war.
Core CPI, which excludes food and energy components, also showed stability with an annual increase of 2.5%. This figure reflects that price pressures in the US economy are still under control and show no signs of a drastic surge before the Middle East crisis began.
Economists see this data as evidence that inflation is still “stubborn” above the 2% target set by the Federal Reserve. Although not worsening compared to January, this stability puts the central bank in a cautious position in determining future monetary policy.
The main contributors to this month’s increase were the services sector and shelter costs. On the other hand, price decreases occurred in the used vehicle and auto insurance categories that helped offset the increase, providing some relief to consumers.
However, the report was considered “old news” by investors as it did not take into account the sharp increase in energy costs that occurred this week. The focus now shifts to how March inflation will respond to the escalating geopolitical crisis.
