The U.S. Bureau of Labor Statistics reported a decrease in annual inflation to 2.8% in February, down from 3% in January. This decline was attributed to lower costs in airfare, shelter, and auto insurance. Core goods prices rose only 3.1% year-over-year, indicating a slowdown not seen since April 2021. The Consumer Price Index (CPI) rose 0.2% month-over-month, significantly lower than January's increase. Experts, such as Moody's Matt Colyar, view this decline positively, suggesting it may lead to better economic conditions despite some price increases in specific areas like medical care.
"February's soft inflation data was certainly welcome. Using February's report as a snapshot, all looks good. Core goods prices rose a manageable 0.2%."
"I don't think the data changes the narrative much. We're encouraging investors to focus on both seizing the opportunity to leg-in to long-term, strategic risk allocations."
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