U.S. consumer prices increased moderately in February as higher shelter costs were partially offset by cheaper airline fares, giving the Federal Reserve room to keep interest rates unchanged next week while monitoring the economic impact of a trade war.

US consumer price inflation data for February came in slightly below expectations across the board. However, while the Fed does not target this index, price pressures are still too strong to warrant a near-term Fed cut. The data does ease fears of resurgent inflation that resulted from a high January CPI reading.

U.S. consumer prices increased less than expected in February, but the improvement is likely temporary against the backdrop of aggressive tariffs on imports that are expected to raise the costs of most goods in the months ahead.

Price growth was set to have cooled slightly in February, forecasters said in advance of the latest Consumer Price Index report, but President Donald Trump’s tariff policies are already threatening to derail things.

The consumer price index for the 25-county region that includes Long Island increased 4.2% last month compared with February 2024, according to the federal Bureau of Labor Statistics.

Economists expect the latest inflation data to deliver some much-needed good news that price growth cooled a bit in February–though with higher tariffs on the horizon, the relief may be short-lived. T

Consumer prices increased less than expected in February, but the improvement is likely temporary against the backdrop of aggressive tariffs on imports that are expected to raise the costs of most goods in the months ahead.