The US Labor Department announced on Thursday (10th) that the CPI in February rose by 7.9% year-on-year and 0.8% month-on-month, slightly higher than expected, and the annual growth rate reached a high point in nearly 40 years. Economists had expected the CPI to rise 7.8% y/y in February.
After deducting energy and inflation, the core CPI was 6.4%, up 0.5% month-on-month, both in line with expectations and the fastest since 1982, when the US economy faced dual threats of rising inflation and slowing economic growth.
The core CPI is especially important to the market because it is the inflation data the Fed is most concerned regarding. But in any case, the market expects that the central bank will raise interest rates by 25 basis points following its meeting next week and start a cycle of interest rate hikes.
Economists had expected the CPI to peak in March, but now they think it won’t peak until later in the spring. The recent surge in gasoline prices will also be mainly reflected in March and April data.
Stephen Stanley, chief economist at Amherst Pierpont, said the surge in energy prices is expected to be largely temporary, so some relief may be seen by mid-year, depending on how long the war in Ukraine takes to end and what other oil and gas suppliers need How long to step in and backfill Russia’s sanctioned exports.
Oil prices have been rising, topping $130 a barrel at one point this week DollarWTI oil prices fell back to 109 per barrel on Wednesday Dollar。