Inflation Rose 0.1% In February; Deflation Is New Risk

Summary

  • The inflation numbers came in close to the consensus, but year-over-year core inflation came in slightly high at 2.4%.
  • Investors are pricing in extremely low inflation over the next 10 years. Is this an overreaction to short-term news? Yes, I think so.
  • I Bond investors can expect a lower variable rate coming at the May 1 reset. My recommendation: Buy I Bonds, up to the purchase cap, before May 1.

U.S. inflation continued in the “moderate zone” in February, but rising turmoil in the stock and commodity markets could bring a short-term swing to deflation in coming months.

The Consumer Price Index for All Urban Consumers rose 0.1% in February on a seasonally adjusted basis, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, “headline” inflation increased 2.3%.

Read my full analysis on SeekingAlpha.com

About Tipswatch

Author of Tipswatch.com blog, David Enna is a long-time journalist based in Charlotte, N.C. A past winner of two Society of American Business Editors and Writers awards, he has written on real estate and home finance, and was a founding editor of The Charlotte Observer's website.
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1 Response to Inflation Rose 0.1% In February; Deflation Is New Risk

  1. John Malcolm says:

    And TIP is down 7% this week!

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