US inflation rose for a second straight month in February on higher gasoline prices.
The core consumer price index (CPI), which excludes food and energy costs, rose 0.4 per cent from January to February, a pickup from the previous month’s figure of 0.3 per cent, according to government data released on Tuesday.
On annual basis, the consumer prices rose 3.2 per cent last month, faster than January’s 3.1 per cent.
The latest consumer prices data indicates that stubborn inflation remains a persistent challenge for the Federal Reserve.
Fed policymakers are expected to hold interest rates steady for a fifth straight time at the upcoming monetary policy meeting next week.
Last week in a 2-day congressional testimony, Federal Reserve chair Jerome Powell had said that the US central bank is “not far” from getting enough confidence that inflation is heading to the Fed’s 2 per cent goal to be able to start interest-rate cuts.
He had also said that the Federal Reserve expects to cut interest rate later this year. “If the economy evolves broadly as expected, it will likely be appropriate to begin dialing back policy restraint at some point this year," Powell said in remarks. “But the economic outlook is uncertain, and ongoing progress toward our 2% inflation objective is not assured.”
The US stock futures and Treasury yields fluctuated after the release of inflation data.
According to the Bureau of Labor Statistics (BLS), shelter and gasoline contributed over 60 per cent of the overall monthly inflation.
Shelter prices, the largest category within services, rose 0.4 per cent, down from a big jump in January.
Grocery prices were unchanged in February and were up just 1 per cent from a year ago period.
The core CPI over the past three months rose an annualized 4.2 per cent, the most since June.
The core CPI is watched closely because it typically provides a better read of where inflation is likely headed.
Catch all the Business News , Economy news , Breaking News Events andLatest News Updates on Live Mint. Download TheMint News App to get Daily Market Updates.