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Key inflation gauge tracked by Federal Reserve slowed in February

The report also showed that consumer spending rose 0.2% from January to February, a drop from a month earlier but an indication that households are still providing fuel for economic growth

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Photo: Bloomberg

AP Washington

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The Federal Reserve's favoured inflation gauge slowed sharply last month, an encouraging sign in the Fed's yearlong effort to cool price pressures through steadily higher interest rates.
Friday's report from the Commerce Department showed that consumer prices rose 0.3% from January to February, down from a 0.6% increase from December to January. Measured year-over-year, prices rose 5%, slower than the 5.3% annual increase in January.
The report also showed that consumer spending rose 0.2% from January to February, a drop from a month earlier but an indication that households are still providing fuel for economic growth.
Taken as a whole, Friday's figures show that inflation pressures, though easing gradually, still maintain a grip on the economy. The Fed has raised its benchmark rate nine times since March of last year in a strenuous drive to tame inflation, which hit a four-decade high in mid-2022.
Even after having slowed, consumer prices are still posting year-over-year increases well above the Fed's 2% target. Earlier this month, the Labor Department said its consumer price index rose 0.4% from January to February and 6% from February 2022.
 
Europe inflation eases to 6.9%

Inflation in the 20 countries that use the euro currency slowed to 6.9 per cent in March, the lowest level in a year, with food costs still on the rise while energy prices fell, making a sharp turnaround after months of punishing increases.

Consumer prices in the eurozone dropped from the 8.5 per cent recorded in February, according to data released on Friday by the European Union’s statistics agency, Eurostat.

The inflation has dropped to its lowest level in a year since since peaking at 10.6 per cent in October.

But prices for food, alcohol and tobacco rose by a painful 15.4 per cent, faster than the previous month’s 15 per cent, in a sign that European consumers are still getting squeezed.

Energy prices, however, fell 0.9 per cent after rising at double-digit rates over the past year.

- AP

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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First Published: Mar 31 2023 | 7:59 PM IST

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