The latest economic data shows inflation cooled more than expected in February. Yahoo Finance Senior Reporter Alexandra Canal joins Brad Smith and Madison Mills to take a closer look at the inflation print, including the categories that have been sticky for consumers, like shelter, energy, and food.
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Well, February CPI coming in lighter than expected, rising two tenths of a percent month over month and 2.8% year over year. Joining us for a category breakdown is our very own Alexander Canal. Ali, I know you dive into everything under the hood. What are we seeing?
Well, let's start with the headline and core CPI number. This was actually the first time since July that we saw both those figures come in at a deceleration in price growth. So that is a positive and you're seeing that being reflected in the market. Underneath the hood though, what sticks out to me is a lot of those sticky categories that affect the everyday consumer, that's actually coming down. So if you think about things like shelter, that has kept up core inflation. But that did show further signs of easing in February. On a yearly basis, we saw that rise 4.2%. That was the smallest 12 month increase since December 2021. On a month over month basis, the shelter index increased by .3%, that's compared to a .4% uptick in January. Same thing with rent and owner's equivalent rent, which is the hypothetical rent you would pay for that same property. Also a 3, a .3% uptick over the prior month. So that's the good news. Also the energy index, that rose just .2% month over month after rising 1.1% in January, and that had a lot to do with the price of gas. So gas prices actually went down, it dropped 1% after nearly a 2% increase in January, so another win for the consumer. And then food prices also showing some signs of deceleration rising just .2% last month after a .5% rise in January. But I do want to mention that egg prices, they're continuing their surge to the upside, up another 10.4% after we saw that 15 plus percent upswing to kick off the year. So, so my takeaway here is that this is a good sign for the everyday consumer, those everyday products that you're paying for whether it be food, gas, your rent, where you're living. So that's a positive. But I have seen some analyst commentary start to trickle in saying that we're not out of the woods yet. We did hear from Jerome Powell last week, he said that he expects the inflation picture to continue to be bumpy in the short to medium term. We are still above the Fed's 2% inflation target, but this is really good news especially considering the fear and the volatility that we saw heading into this week.
You know, it's interesting, we were looking through airline fairs and I'm kind of getting hyper obsessed about this because now I'm running some numbers just about the the figure that we saw come forward within the print, which was uh decrease in prices of 4% there. But it's actually interesting because now looking at some of the TSA passenger throughput numbers, as I've just been frantically running some Excel formulas here on my screen, we're not far off of what the run rate was in 2024, which was a record high year for travel. And so even despite the price pullback, people are still traveling. At least the TSA travel passenger throughput, even after the Delta Toronto crash uh on February 19th, we're still at 99%, roughly 99.94% is the exact figure that we are at since that position. So it's just remarkable to see the type of pullback that we're seeing despite the the price, well the price pullback, despite the TSA traveler throughput remaining roughly the same and in line with 2024.
Yeah, and interesting too since we heard from Delta and some of those airliners reducing their guidance, citing possible consumer pullbacks, uh citing a possible demand slowdown there. But yeah, I also think for the consumer, we've been in this high inflationary environment for a very long time. And we've been sort of accustomed to paying a lot of these higher prices. So hopefully that 4% decline in airline fairs, we will start to really feel that considering we've been used to very stubbornly high airline figures. Uh But you know, people still need to travel, they still want to travel. I'm literally going on a flight today. I paid a pretty penny for my flight. So it's one of those
premium travelers Ali. You're bank
You know, I do, I do pay extra for the exit row. I'm not gonna lie.
Really?
I'm a tall girl. I like, I like a lot of legroom.
Got to have the leg space.
Yeah. Comfort plus, comfort plus you got.
Exactly. I love that for you.
Thank you so much. Safe travels too.