abc

A breather on inflation: half the rate of January.
Posted on March 14, 2025

We got a breather on inflation. Inflation for February was half the rate for January. The most-widely reported measure, seasonally adjusted inflation, increased about 0.2% in January; the last six months point to about 3.6% annual rate. Core inflation, the measure closest to the one the federal reserve favors, was also half January’s rate; the last six months points to about 3.5% annual rate.

I display a table and six graphs that I use to follow the trends in inflation.

Details:

The two most widely-reported measures of inflation are Seasonally-adjusted inflation and Core inflation.

Seasonally-adjusted inflation in February was less than half the rate in January. February broke a trend of increased steadily increasing inflation. This is the most widely reported measure of inflation.

Core inflation excludes volatile energy and food components. February’s rate was half that of January. The last six months run average to 3.5% annual rate.

I displayed this graph two weeks ago: Personal Consumption Expenditures (PCE) excluding Food and Energy is the measure of inflation that the Federal Reserve Board favors. The graph shows the data ending January; The last six aim at an annual rate of 2.6%.

== History of 12-month inflation rates ==

Full-year inflation measured by CPI-U shows that inflation for the last 12 months is at 2.8%. This lower than the past two months.

== Producer’s Price Index ==

The change in producer prices will impact consumer inflation. PPI for February was one-third lower than January. The prior ten months have averaged below 0% annual rate