U.S. consumer prices cooled in February, rising less than expected after climbing more than anticipated in January to an 18-month high, according to a government report released Wednesday, March 12.
Prices for food, overall energy, and used vehicles, along with other items, saw some relief after broad-based inflation gains the previous month, while gasoline, airline fares, and new vehicle prices declined. Shelter prices also eased slightly but remained elevated.
"The index for shelter rose 0.3 percent in February, accounting for nearly half of the monthly all items increase. The shelter increase was partially offset by a 4.0-percent decrease in the index for airline fares and a 1.0-percent decline in the index for gasoline," the inflation report noted.
The headline monthly inflation figure showed a 0.2% increase in U.S. consumer prices for February, following a 0.5% rise in January – the largest gain since August 2023 – according to the Labor Department’s March 12 Consumer Price Index (CPI) report.
The Consumer Price Index (CPI), a key inflation gauge, measures what American consumers pay for a wide range of everyday goods and services, from eggs to energy. The widely reported consensus had projected a 0.3% monthly increase.
Food prices overall rose 0.2% in February after a 0.4% increase in January. Grocery store prices were unchanged, slowing from January’s 0.5% gain, while dining-out costs accelerated, climbing 0.4% after a 0.2% increase the previous month.
Food prices rose 2.6% year-over-year, up from 2.5%, with grocery prices climbing 1.9% for a second month and dining-out expenses increasing 3.7%, up from 3.4%.
In other sectors, gasoline prices fell 1% in February after rising 1.8% in January. Annually, gas prices dropped 3.1%, following a 0.2% decline the previous month.
The broader energy index, which includes gasoline, electricity, and fuel oil, edged up 0.2% in February after a 1.1% increase in January. Year-over-year, energy prices declined 0.2%, reversing a 1% gain the prior month.
Excluding volatile food and energy components, the rate of core consumer prices rose 0.2% in February, down from the previous 0.4% increase and landing a tenth of a percentage point below expectations.
Shelter costs climbed 0.3%, down from January’s 0.4% gain but extending their streak to 58th consecutive months of increase. Year-over-year, shelter prices rose 4.2%, easing from the prior 4.4% gain.
Other recent 12-month comparisons show gains 4.6% in December, 4.7% in November, 4.9% in both October and September, 5.2% in August, 5.1% in July, 5.2% in June, 5.4% in May, 5.5% in April, 5.7% in both March and February, 6% in January, 6.2% in December 2023, 6.5% in November 2023, 6.7% in October 2023, 7.2% in September 2023, 7.3% in August 2023, 7.7% in July 2023, 7.8% in June 2023, 8% in May 2023, 8.1% in April 2023, and 8.2% in March 2023, the latter being the most significant annual increase since June 1982.
The shelter component of the CPI includes prices for items such as apartment rents, owners’ equivalent rent – a measure of what homeowners would pay to rent or earn from renting their property – lodging away from home like hotels and motels, and housing at schools.
In other key pricing categories:
- Clothing prices rose 0.6% in February, reversing a 1.4% decline in January, and were also 0.6% higher than a year earlier.
- New vehicle prices edged down 0.1% after remaining unchanged in January, while year-over-year they declined 0.3%.
- Used car and truck prices climbed 0.9% in February, slowing from January’s 2.2% gain, and were up 0.8% from the previous year.
- Airline fares fell 4% in February after a 1.2% increase in January, dropping 0.7% over the past year.
For the headline annual rate, inflation climbed 2.8% over the 12 months ending in February, down from 3% in January and a tenth of a percentage point below forecasts.
For a broader perspective and a look further back, the inflation rate peaked at 9.1% during the 12-month period ending in June 2022. This was the fastest rate of inflation since November 1981. Additionally, until March 2023, inflation rates had remained at or above 6% for 17 consecutive months.
Meanwhile, core inflation rose 3.1% over the year through February, coming in one-tenth below expectations and following the previous 3.3% increase. This core, "all items less food and energy" index, is one of the benchmark inflation rates monitored by the Federal Open Market Committee (FOMC) to guide the central bank in setting its key interest rate.
"Trade wars are expected to raise prices in future inflation reports," Reuters quoted Chris Low, chief economist at FHN Financial. "The Fed is sidelined now by price uncertainty, but the odds they can cut again this year once the smoke from the tariff back-and-forth clears increased today nonetheless."
In September 2022, the annual core inflation rate at 6.6% was the highest since August 1982. Many economists consider the core reading as a better predictor for future inflation.
The following table of key inflation figures is for the last seven months through February, as published by the U.S. Labor Department’s Bureau of Labor Statistics (www.bls.gov/cpi) on March 12, 2025. To index the data each month, the BLS monitors the prices of about 80,000 consumer goods and services from around the nation. All monthly and annual pricing changes are in percentages.
August 2024 to February 2025 Consumer Prices – Gains & Losses in Percent
(Seasonally Adjusted from Prior Month and Unadjusted 12-Month)
| Aug 2024 | Sept 2024 | Oct 2024 | Nov 2024 | Dec 2024 | Jan 2025 | Feb 2025 | 12 Month | |
| All items | 0.2 | 0.2 | 0.2 | 0.3 | 0.4 | 0.5 | 0.2 | 2.8 |
| Food | 0.2 | 0.3 | 0.2 | 0.3 | 0.3 | 0.4 | 0.2 | 2.6 |
| Food at home | 0.1 | 0.3 | 0.2 | 0.4 | 0.3 | 0.5 | 0.0 | 1.9 |
| Food away from home | 0.3 | 0.3 | 0.2 | 0.3 | 0.3 | 0.2 | 0.4 | 3.7 |
| Energy | -1.0 | -1.0 | -0.2 | 0.1 | 2.4 | 1.1 | 0.2 | -0.2 |
| Energy commodities | -1.3 | -2.3 | -1.1 | 0.2 | 3.9 | 1.9 | -0.9 | -3.2 |
| Gasoline (all types) | -1.2 | -2.3 | -1.0 | 0.3 | 4.0 | 1.8 | -1.0 | -3.1 |
| Fuel oil | -2.8 | -3.8 | -2.3 | -1.4 | 2.1 | 6.2 | 0.8 | -5.1 |
| Energy services | -0.7 | 0.6 | 0.7 | -0.1 | 0.8 | 0.3 | 1.4 | 3.3 |
| Electricity | -0.4 | 0.5 | 0.8 | -0.2 | 0.2 | 0.0 | 1.0 | 2.5 |
| Utility (piped) gas service | -1.6 | 0.7 | 0.5 | 0.5 | 2.8 | 1.8 | 2.5 | 6.0 |
| All items less food, energy | 0.3 | 0.3 | 0.3 | 0.3 | 0.2 | 0.4 | 0.2 | 3.1 |
| Commodities less food, energy | -0.1 | 0.2 | 0.0 | 0.2 | 0.0 | 0.3 | 0.2 | -0.1 |
| New vehicles | 0.0 | 0.1 | 0.0 | 0.5 | 0.4 | 0.0 | -0.1 | -0.3 |
| Used cars and trucks | -0.2 | 0.5 | 1.2 | 1.3 | 0.8 | 2.2 | 0.9 | 0.8 |
| Apparel | 0.1 | 1.0 | -0.9 | 0.1 | 0.1 | -1.4 | 0.6 | 0.6 |
| Medical care | -0.2 | -0.7 | -0.2 | -0.1 | 0.0 | 1.2 | 0.1 | 2.3 |
| Services less energy | 0.4 | 0.4 | 0.3 | 0.3 | 0.3 | 0.5 | 0.3 | 4.1 |
| Shelter | 0.5 | 0.3 | 0.4 | 0.3 | 0.3 | 0.4 | 0.3 | 4.2 |
| Transportation | 0.8 | 1.2 | 0.4 | 0.1 | 0.5 | 1.8 | -0.8 | 6.0 |
| Medical care | -0.1 | 0.6 | 0.3 | 0.3 | 0.2 | 0.0 | 0.3 | 3.0 |
The BLS releases inflation data around the middle of the month, covering consumer prices surveyed up to the previous month. The Consumer Price Index (CPI) for March and the latest annual period will be made public on April 10, 2025.
The CPI data is also used to calculate inflation rates and power this site’s U.S. Inflation Calculator, which displays the cumulative inflation and the change in the buying power of the U.S. dollar over time.
