WASHINGTON—Inflation cooled more than anticipated in February, offering a positive signal for the Fed as it navigates the challenges of rising prices and slower growth stemming from President Trump’s trade war.
The Consumer Price Index rose 2.8% over the 12 months ending in February, down from January’s 3% annual rate, according to Bureau of Labor Statistics data released Wednesday. Month-over-month, prices increased by 0.2%, compared to 0.5% in January.
"Inflation slowed in February after elevated readings over the past three months. Both headline and core prices rose by 0.2% month-over-month, aligning with the Federal Reserve’s target,” said Dawit Kebede, America's Credit Unions Senior Economist. “Core inflation and housing recorded their lowest readings since 2021. However, the recent tariff rate increases cast a shadow on this progress. Prices of several goods affected by the tariff war are expected to rise, potentially reversing the trend and hindering economic growth."