{"id":9637,"date":"2025-03-12T15:58:01","date_gmt":"2025-03-12T19:58:01","guid":{"rendered":"https:\/\/thetimesfinancial.com\/?p=9637"},"modified":"2025-03-12T15:58:04","modified_gmt":"2025-03-12T19:58:04","slug":"us-inflation-cools-but-tariffs-threaten-price-surge","status":"publish","type":"post","link":"https:\/\/thetimesfinancial.com\/?p=9637","title":{"rendered":"US Inflation Cools, But Tariffs Threaten Price Surge"},"content":{"rendered":"\n<p>US inflation slowed in February for the first time since September, with core inflation dropping to a four-year low. However, newly imposed tariffs by President Donald Trump could reignite price pressures, economists warn.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Inflation Decline Offers Temporary Relief<\/h2>\n\n\n\n<p>The consumer price index (CPI) rose 2.8% in February from a year ago, down from January\u2019s 3% increase, according to the Labor Department. Core prices, excluding food and energy, rose 3.1% from a year earlier, the lowest since April 2021. Both figures came in below economists\u2019 expectations.<\/p>\n\n\n\n<p>On a monthly basis, CPI increased just 0.2% in February, down from 0.5% in January. Core prices also rose by 0.2%, compared to 0.4% the previous month.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Key Contributors to Inflation Drop<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Airfares fell 4% in February.<\/li>\n\n\n\n<li>Rental price increases slowed.<\/li>\n\n\n\n<li>Hotel and car insurance costs rose at a lower pace.<\/li>\n\n\n\n<li>New car prices declined compared to January.<\/li>\n\n\n\n<li>Grocery prices remained unchanged.<\/li>\n<\/ul>\n\n\n\n<p>However, egg prices surged 10.4% in February due to an avian flu outbreak, making them nearly 60% more expensive than a year ago. Average egg prices hit a record high of $5.90 per dozen.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Tariffs Could Reverse Inflation Gains<\/h2>\n\n\n\n<p>Despite cooling inflation, Trump\u2019s tariffs could push prices higher. On Wednesday, Trump imposed sweeping 25% tariffs on all steel and aluminum imports. These duties are expected to raise costs for vehicles, appliances, and electronics.<\/p>\n\n\n\n<p>The European Union and Canada retaliated with new tariffs on US exports, with Canada planning $21 billion in duties. Additional reciprocal tariffs are set for April 2, which could push the average US tariff rate to its highest level since 1937, costing households up to $3,400 annually.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Businesses Brace for Higher Costs<\/h2>\n\n\n\n<p>Small businesses and major retailers are already preparing for the impact:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Walmart CFO John David Rainey<\/strong>: Warned of price hikes in some product categories.<\/li>\n\n\n\n<li><strong>Target CEO Brian Cornell<\/strong>: Predicted rising produce prices, especially Mexican avocados.<\/li>\n\n\n\n<li><strong>Best Buy CEO Corie Barry<\/strong>: Expected higher supplier prices, with China and Mexico as key sources.<\/li>\n\n\n\n<li><strong>Toy Industry<\/strong>: Prices for games, dolls, and cars may rise 15%-20% due to China tariffs.<\/li>\n<\/ul>\n\n\n\n<p>\u201cWe\u2019re going to have to pass along (the cost) to the consumer,\u201d said Ethan Frisch, co-CEO of Burlap &amp; Barrel. \u201cIt\u2019s going to make the product more expensive, which will slow down sales.\u201d<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Outlook for Inflation and the Economy<\/h2>\n\n\n\n<p>While February\u2019s inflation report provided temporary relief, the long-term impact of tariffs remains uncertain. With price increases expected across multiple industries, economists predict inflation will remain elevated throughout 2025.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>US inflation slowed in February for the first time since September, with core inflation dropping to a four-year low. However, newly imposed tariffs by President Donald Trump could reignite price pressures, economists warn. Inflation Decline Offers Temporary Relief The consumer price index (CPI) rose 2.8% in February from a year ago, down from January\u2019s 3% [&hellip;]<\/p>\n","protected":false},"author":10772,"featured_media":9638,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8],"tags":[1188,576,1186,799,289,1189,1187,1190,575,1185],"class_list":{"0":"post-9637","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-finance","8":"tag-business-response","9":"tag-consumer-prices","10":"tag-cpi-report","11":"tag-economic-impact","12":"tag-federal-reserve","13":"tag-recession-risks","14":"tag-steel-and-aluminum-tariffs","15":"tag-trade-war","16":"tag-trump-tariffs","17":"tag-us-inflation"},"_links":{"self":[{"href":"https:\/\/thetimesfinancial.com\/index.php?rest_route=\/wp\/v2\/posts\/9637","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/thetimesfinancial.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/thetimesfinancial.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/thetimesfinancial.com\/index.php?rest_route=\/wp\/v2\/users\/10772"}],"replies":[{"embeddable":true,"href":"https:\/\/thetimesfinancial.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=9637"}],"version-history":[{"count":1,"href":"https:\/\/thetimesfinancial.com\/index.php?rest_route=\/wp\/v2\/posts\/9637\/revisions"}],"predecessor-version":[{"id":9639,"href":"https:\/\/thetimesfinancial.com\/index.php?rest_route=\/wp\/v2\/posts\/9637\/revisions\/9639"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/thetimesfinancial.com\/index.php?rest_route=\/wp\/v2\/media\/9638"}],"wp:attachment":[{"href":"https:\/\/thetimesfinancial.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=9637"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/thetimesfinancial.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=9637"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/thetimesfinancial.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=9637"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}