US inflation likely stayed elevated last month as Federal Reserve looks toward eventual rate cuts
Consumer prices likely rose last month at a pace that would exceed the Federal Reserve’s inflation target, underscoring why the Fed is being cautious as it considers when to cut interest rates and suggesting that inflation will remain a potent issue in President Joe Biden’s re-election race
WASHINGTON (AP) — Consumer prices likely rose last month at a pace that would exceed the Federal Reserve's inflation target, underscoring why the Fed is being cautious as it considers when to cut interest rates and suggesting that inflation will remain a potent issue in this year's presidential election.
Yet Tuesday's report from the Labor Department may also show that underlying price pressures continue to ease, which would be an encouraging sign that inflation is gradually coming under control.
Economists have estimated that prices rose at a brisk 0.4% annual pace from January to February, up from a 0.3% rise the previous month, according to estimates compiled by FactSet. Compared with a year earlier, inflation is expected to have remained 3.1% in February, unchanged from January.
Higher gas costs likely drove much of last month's overall inflation. The average national pump price climbed from $2.94 a gallon in mid-January to $3.08 in mid-February, according to the Energy Department. Grocery prices are thought to have ticked up, too. And because of higher food and labor costs, restaurant prices are expected to have risen more than they did before the pandemic.
