Inflation holds steady, with prices rising 2.4% on an annual basis in February

Consumer prices grew at an annual pace of 2.4% in February, meaning inflation is holding steady.

The Bureau of Labor Statistics said the Consumer Price Index rose 0.3% in February compared to 0.2% in January.  Shelter costs rose 0.2% in February, making it the main factor in the monthly increase.

The report aligned with expectations on Wall Street and is unlikely to have a big impact at the Federal Reserve, which is expected to hold interest rates steady when it meets next week. 

The annual rate of 2.4% is above the Fed’s target of 2%. But the overall picture is positive compared to post-pandemic years under the Biden administration, when inflation soared.

President Trump is navigating a complex economic landscape in a midterm year, with affordability issues at the center.

Inflation rose 2.4% on an annual basis in January, a positive development, but the most recent jobs report showed the U.S. shed 92,000 positions — a sour, and unexpected, development.

The economic picture has been complicated by conflict in the Middle East.

Oil prices rose after Mr. Trump bombarded Iran in joint strikes with Israel.

Tehran retaliated by striking oil-rich Gulf states and clamping down on the Strait of Hormuz, a critical artery for 20% of the world’s oil shipments.

Oil prices surged above $100 per barrel earlier in the week before easing below $90, as the Group of Seven industrialized nations plotted the release of supply from strategic stockpiles and Mr. Trump suggested the war could end soon.

Republicans and Democrats took different views of what the inflation report meant for everyday Americans.

“After four years of a disastrous economy and skyrocketing inflation under Joe Biden and the Democrats, President Trump has supercharged our economy and brought inflation down,” the Republican National Committee said in a statement.

Democrats said the report showed prices were effectively stuck at too-high levels, and noted the reading did not include the impact of the Iran war.

“Even before the war, inflation has stayed elevated, which means that Americans are continuing to pay more for groceries and rent and electricity,” Senate Minority Leader Charles E. Schumer, New York Democrat, said. “People want costs to go down, not to stay where they are.”