HomeInflationU.S. Inflation Accelerates, Reaching 5-Month High in February

U.S. Inflation Accelerates, Reaching 5-Month High in February

Consumer prices in the United States have continued to surpass projections, hitting their highest point in five months as of February. The rising costs of shelter and gasoline greatly contributed to driving inflation for the month, although Americans finally saw some relief in what they paid for groceries.

"The index for shelter rose in February, as did the index for gasoline. Combined, these two indexes contributed over sixty percent of the monthly increase in the index for all items," the Labor Department’s monthly report said.

In the headline figure for the month, U.S. consumer prices rose by 0.4% in February, the most since September, after rising by 0.3% in January, the Labor Department said March12 in its monthly report on the Consumer Price Index (CPI).

The CPI is a closely watched inflation gauge that measures what Americans consumers pay for everyday items, ranging from eggs to energy. The reported 0.4% rate was in line with expectations.

Overall, food prices for the month were unchanged following a 0.4% increase. Within the food category, grocery prices also remained unchanged after advancing 0.4% in January. Additionally, dining-out expenses edged up by 0.1% following a 0.5% increase.

Meanwhile, over the past year, food inflation registered a rate of 2.2%, compared to the previous 2.6%. Throughout this period, grocery prices saw a rise of 1%, while dining out costs grew by 4.5%. These numbers stand in contrast to their earlier increased rates of 1.2% for groceries and 5.1% for dining out.

In other sectors, prices at the pump bounced up by 3.8% in February, contrasting with the previous month’s 3.3% decline. When looking at a year-on-year comparison, gas prices declined by 3.9%, compared to the previous drop of 6.4%.

The broader energy index, which includes items like gasoline, electricity, and fuel oil, increased by 2.3% in February, following a 0.9% decline in January. Energy prices year-over-year fell by 1.9%, which compares to the previously recorded decline of 4.6%.

Excluding volatile food and energy components, the rate of core consumer prices in February rose by 0.4% for the second consecutive month, compared to an expected increase of 0.3%.

Shelter or housing prices increased by 0.4% during the month, marking their 46th straight monthly rise. This follows a 0.6% increase in January and represents another significant year-over-year growth of 5.7%. For some recent 12-month comparisons, they recorded increases of 6% in January, 6.2% in December, 6.5% in November, 6.7% in October, 7.2% in September, 7.3% in August, 7.7% in July, 7.8% in June, 8% in May, 8.1% in April, and 8.2% in March, which was their most significant annual increase since June 1982.

Components of shelter include prices of items like rent for apartments, rental equivalence, lodging away from home such as hotels and motels, and housing at schools. This index accounts for about one-third of the entire CPI.

In other closely watched pricing areas:

  • Clothing prices increased by 0.6% for the month after falling by 0.7% previously. They were unchanged from a year ago.
  • New vehicle prices declined by 0.1% in February after being unchanged. They showed a year-over-year increase of 0.4%.
  • Prices for used cars and trucks climbed by 0.5% during the month, after dropping by 3.4% previously. In comparison to prices from a year ago, they have declined by 1.8%.
  • When compared to the previous year, airline fares fell by 6.1%. As for the month, they jumped by 3.6% following a 1.4% increase.

In terms of the headline annual rate, inflation rose by 3.2% for the 12 months ending February, up from the 3.1% inflation rate reported for the annual period ending in January. Commonly reported expectations for the period indicated an advance of 3.1%.

For some perspective, there was a notable peak in the inflation rate at 9.1% during the 12-month period ending in June 2022. It was the quickest rate of inflation since November 1981. Additionally, until March 2023, inflation rates had been at or above 6% for 17 consecutive months.

Meanwhile, core inflation increased 3.8% in the year through February, the slowest since May 2021, compared to core rates of 3.9% in each of the two prior periods. However, the widely reported consensus was a 3.7% annual 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.

"Inflation continues to churn above 3%, and once again shelter costs were the main villain. With home prices expected to rise this year and rents falling only slowly, the long-awaited fall in shelter prices isn’t coming to the rescue any time soon," CNBC quoted Robert Frick, corporate economist at Navy Federal Credit Union. "Reports like January’s and February’s aren’t going to prompt the Fed to lower rates quickly."

As recently as 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, 2024. 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 2023 to February 2024 Consumer Prices – Gains & Losses in Percent
(Seasonally Adjusted from Prior Month and Unadjusted 12-Month)

  Aug 2023 Sept 2023 Oct 2023 Nov 2023 Dec 2023 Jan 2024 Feb 2024 12 Month
All items 0.5 0.4 0.1 0.2 0.2 0.3 0.4 3.2
  Food 0.2 0.2 0.3 0.2 0.2 0.4 0.0 2.2
    Food at home 0.2 0.1 0.3 0.0 0.1 0.4 0.0 1.0
    Food away from home 0.3 0.4 0.4 0.4 0.3 0.5 0.1 4.5
  Energy 4.4 1.2 -2.1 -1.6 -0.2 -0.9 2.3 -1.9
    Energy commodities 8.3 1.8 -4.3 -3.8 -0.7 -3.2 3.6 -4.2
      Gasoline (all types) 8.3 1.6 -4.3 -4.0 -0.6 -3.3 3.8 -3.9
      Fuel oil 11.2 6.4 -6.4 -1.1 -3.3 -4.5 1.1 -5.4
    Energy services 0.1 0.3 0.4 1.0 0.3 1.4 0.8 0.5
      Electricity 0.2 0.8 0.4 1.0 0.6 1.2 0.3 3.6
      Utility (piped) gas service -0.3 -1.4 0.3 1.2 -0.6 2.0 2.3 -8.8
  All items less food, energy 0.2 0.3 0.2 0.3 0.3 0.4 0.4 3.8
    Commodities less food, energy -0.2 -0.2 0.0 -0.2 -0.1 -0.3 0.1 -0.3
      New vehicles 0.2 0.2 -0.1 0.0 0.2 0.0 -0.1 0.4
      Used cars and trucks -1.9 -1.8 -0.4 1.4 0.6 -3.4 0.5 -1.8
      Apparel 0.2 -0.3 0.0 -0.6 0.0 -0.7 0.6 0.0
      Medical care 0.6 -0.3 0.4 0.5 -0.1 -0.6 0.1 2.9
    Services less energy 0.4 0.5 0.3 0.5 0.4 0.7 0.5 5.2
      Shelter 0.3 0.6 0.3 0.4 0.4 0.6 0.4 5.7
      Transportation 1.6 0.7 0.9 1.0 0.1 1.0 1.4 9.9
      Medical care 0.0 0.2 0.2 0.5 0.5 0.7 -0.1 1.1


The BLS releases inflation data around the middle of the month for 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, 2024.

The CPI data is also used to calculate inflation rates and to power this site’s U.S. Inflation Calculator. The U.S. Inflation Calculator displays the cumulative inflation and the change in the buying power of the U.S. dollar over time.


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