US inflation slowed greater than anticipated in February, with core inflation posting its smallest achieve since 2021 — though the information was gathered earlier than President Trump started to amp up his tariff wars this month.
The Shopper Worth Index rose 2.8% over the previous 12 months — beneath the two.9% achieve that economists had anticipated and in addition beneath final month’s surprisingly robust 3% studying, the Bureau of Labor Statistics mentioned Wednesday.
Core CPI, which excludes unstable meals and vitality costs, got here in at 3.1% — the bottom studying since April 2021.
Dow Jones futures rose 223 factors, or 0.5%, on the softer inflation report. S&P 500 futures jumped 0.8% greater, and Nasdaq 100 futures gained about 0.9%.
The much less heated report comes as inflation considerations have mounted over President Trump’s commerce insurance policies, and investor optimism for rate of interest cuts anytime quickly has dipped.
Nevertheless, February’s report doesn’t seize the affect from Trump’s tariffs.
President Trump’s threatened tariffs on Canada and Mexico — that are at the moment on a second 30-day pause — and his 20% levy on China have spurred fears of inflation and a attainable recession.
Trump’s 25% tariffs on metal and aluminum imports took impact early Wednesday morning. The European Union introduced retaliatory tariffs that may take maintain in April.
Heightened commerce tensions have spooked buyers and stoked volatility within the markets.
The “Magnificent 7” tech shares — Tesla, Nvidia, Alphabet, Meta, Amazon, Apple and Microsoft — have shed greater than $1.5 trillion off their mixed valuation for the reason that begin of 2025 after having fun with large features final 12 months.
Heated client and producer value reviews early final month had some economists warning that fee hikes may even be on the desk.
However the private consumption expenditures index — the Fed’s most popular inflation gauge — signaled easing inflation later that month.
The Federal Open Market Committee is about to satisfy on March 18-19, when buyers largely count on they’ll hold rates of interest the identical within the goal 4.25% to 4.5%, in line with CME FedWatch.
