Inflation Ticks Up as Housing and Food Push Consumer Prices 2.4% Higher Over Past Year

U.S. inflation picked up modestly in February, with consumer prices rising 0.3 percent on the month and 2.4 percent over the past year, according to the latest Consumer Price Index report from the Bureau of Labor Statistics.

The all items Consumer Price Index for All Urban Consumers (CPI-U) increased 0.3 percent in February on a seasonally adjusted basis, up from a 0.2 percent gain in January. Over the last 12 months, prices were 2.4 percent higher, matching the annual rate recorded in January and keeping inflation close to the Federal Reserve’s 2 percent target range.

Shelter remained the single largest contributor to February’s increase, rising 0.2 percent for the month and 3.0 percent over the year. Food prices also put upward pressure on inflation, with the overall food index up 0.4 percent in February and 3.1 percent compared with a year earlier.

Grocery prices (“food at home”) rose 0.4 percent on the month and 2.4 percent over 12 months, led by categories such as fruits and vegetables, up 1.4 percent in February and 2.7 percent over the year, and nonalcoholic beverages, up 0.8 percent in February and 5.6 percent over the year. The index for “other food at home” climbed 0.8 percent for the month and 3.3 percent over the year, with candy and chewing gum up 3.7 percent in February alone.

Restaurant and takeout prices (“food away from home”) increased 0.3 percent in February and 3.9 percent over the past year, including a 4.6 percent annual rise for full service meals and 3.2 percent for limited service meals.

Energy prices increased 0.6 percent in February after a 1.5 percent decline in January, reflecting a rebound in several key categories. Gasoline prices rose 0.8 percent for the month, while natural gas (utility piped gas service) jumped 3.1 percent; in contrast, electricity prices fell 0.7 percent in February.

Over the year, the overall energy index was up 0.5 percent. Electricity prices were 4.8 percent higher and natural gas was up 10.9 percent, while gasoline prices were 5.6 percent lower than a year earlier.

Within core categories, medical care prices rose 0.5 percent on the month and 3.4 percent over the year, with hospital services up 0.6 percent and physicians’ services up 0.3 percent in February, while prescription drug prices slipped 0.2 percent. Apparel prices jumped 1.3 percent in February and were 2.5 percent higher than a year ago, and household furnishings and operations rose 0.3 percent in February and 3.9 percent over 12 months.

Transportation services continued to advance, with the broader category up 2.2 percent over the year, and airline fares rising 1.4 percent in February. Some categories moved lower: communication fell 0.5 percent, used cars and trucks declined 0.4 percent in February and 3.2 percent over the year, motor vehicle insurance slipped 0.3 percent, and personal care edged down 0.2 percent on the month despite being 4.5 percent higher than a year earlier.