Inflation Did Not Cooperate Last Month

Consumer prices ticked up as Biden administration hopes they ease
By Newser Editors and Wire Services
Posted Mar 12, 2024 9:06 AM CDT
Inflation Did Not Cooperate Last Month
Shoppers carry their purchases in Bradenton, Florida, on Feb. 9.   (AP Photo/Gene J. Puskar)

Consumer prices in the United States picked up last month, a sign that inflation remains a persistent challenge for the Federal Reserve and for President Biden's reelection campaign, both of which are counting on a steady easing of price pressures this year.

  • Slight increase: Prices rose 0.4% from January to February, a pickup from the previous month's figure of 0.3%. Compared with 12 months earlier, consumer prices rose 3.2% last month, faster than January's 3.1% annual pace and a faster pace than the Fed's 2% target, per the AP.
  • At the core: Excluding volatile food and energy prices, so called "core" prices also climbed 0.4% from January to February, matching the previous month's increase. Core inflation is watched especially closely, as it typically provides a better read of where inflation is likely headed.
  • Overall: Inflation has plummeted from a peak of 9.1% in June 2022, though it's now easing more slowly than it did last spring and summer. The prices of some goods, from appliances to furniture to used cars, are actually falling after clogged supply chains during the pandemic sent prices soaring.
  • Still an issue: By contrast, prices for restaurant meals, car repairs, hospital care, and other services are still rising faster than they did before the pandemic. Car insurance has shot up, reflecting rising costs for auto repair and replacement. And after having sharply raised pay for nurses and other in-demand staff, hospitals are passing their higher wage costs on to patients in the form of higher prices.
  • Voters: Perceptions of inflation are sure to occupy a central place in this year's presidential election. Despite a healthy job market and a record-high stock market, polls show many Americans blame Biden for the surge in consumer prices that began in 2021. Though inflationary pressures have significantly eased, average prices remain well above where they stood three years ago.
  • What's next: Fed Chair Jerome Powell signaled in congressional testimony last week that the central bank is getting closer to cutting rates. Most economists expect the Fed's first rate cut to occur in June, though May is also possible. More here.
(More inflation stories.)

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