Inflation Eases

The consumer price index in February fell for the eighth consecutive month to 6% year-over-year growth, down from the 6.4% rise in January and in-line with economist expectations. The annual figure is the lowest increase since September 2021. Prices increased by 0.4% on a month-to-month basis. Housing was the biggest contributor to overall inflation, rising 0.8% for the month and 8.1% for the year and accounting for 70% of February’s gain. Groceries (10.2%) and energy (5.2%) prices for the 12 months ending in February also contributed to the increase. Core CPI, which excludes food and energy prices, increased by 0.5% on the month and 5.5% on the year. See data here. Elevated inflation, paired with the recent collapses of Silicon Valley Bank and Signature Bank, poses a challenge for the Federal Reserve, which aims to bring inflation down to 2%. It is unclear how officials will react at the Fed's meeting next week; however, experts predict the Fed to continue with a 0.25 percentage point increase.