Labor Department releases February inflation report widely awaited

Inflation in the US has slowed down to 2,8% in February, with the main prices rising 3,1% in annual terms, According to the last report of the Labor Department. Despite the slowdown, inflationary pressures persist, especially in key categories such as food and housing. The Federal Reserve should keep the interest rates stable at the next monetary policy meeting. Below is a summary of the latest Foxbusiness Inflation Report, highlighting the main trends and expectations of the market.

Both monthly and annual increases were lower than the expectations of economists, As designed by LSEG Analysts*. The main prices, that exclude volatile categories such as food and gasoline, climbed 0,2% in February and 3,1% compared to the previous year, Also below forecasts.

Although inflation continues to challenge the American homes, Food prices presented modest changes. The food rate for domestic consumption remained stable during the month, registering an increase in 1,9% last us 12 months, providing a sense of stability. Egg prices rose remarkably 10,4% in February, while meat prices, birds and fish increased 0,5%. On the other hand, Fruit prices, Non -alcoholic vegetables and drinks fell 0,5%, and dairy prices recorded a greater drop of 1% in the month.

These data arrive shortly before the next Federal Monetary Policy meeting, marked for the days 18 e 19 March, in which it is expected widely that interest rates remain unchanged for the second consecutive time. The current Fed reference rate is in a target range of 4,25% a 4,5%.

Ellen hundredweight, Morgan Stanley Wealth Management's chief strategist, pointed out that, Although February inflation data was encouraging, The Federal Reserve probably will not implement immediate cuts in the rates. “The Fed adopted a waiting and observation posture”, observed Zentner, highlighting economic uncertainties linked to trade and immigration policies.

Market expectations for the Fed to keep stable rates increased to 99%, compared to 96% the day before and 94% a week before, According to CME Fedwatch Tool. This consensus reflects the current economic climate and the likely approach of the Fed.

*A LSEG (London Stock Exchange Group) is a global conglomerate of financial services, linked in London.

Wall Street Journal's executive editor, Gerry Baker, comments on the importance of making permanent tax cuts and President Donald Trump blaming former President Joe Biden for inflation during his speech in Congress.