US Inflation Decreases; Pressure Mounts on the Fed to Reduce Interest Rates

The US Bureau of Labor Statistics revealed that the consumer price index (CPI) rose just 0.2% in February. This was less than the expected 0.3% rise. January saw a 0.5% increase. The year-over-year inflation rate was 2.8%. This was slightly below the predicted 2.9%. Lower inflation numbers may cause the Federal Reserve to consider lowering interest rates.

The core CPI also rose by 0.2%. This number excludes food and energy prices. Experts predicted a 0.3% rise. The annual core inflation rate was 3.1%. That was under the 3.2% that was expected. These figures suggest that underlying inflation may be cooling. This could give the Federal Reserve more reason to cut rates.

Bitcoin's price jumped over 1% to $84,100 after this report. Markets had already expected a Fed rate cut by the June meeting. There was an 85% chance of that before the report came out. Now, investors will watch the Producer Price Index (PPI). That report comes out on Thursday. It might give more clues about inflation and the future of monetary policy. The PPI measures price changes from the seller's perspective. It often leads to changes in the CPI.