BlockBeats News, March 11th, the US Department of Labor reported on Wednesday that the Consumer Price Index rose by 2.4% year-on-year in February. This data was the same as in January and in line with surveyed economists’ expectations. The core price index, which excludes the more volatile food and energy items, also rose by 2.5% year-on-year, as expected.
However, since the outbreak of the Iran conflict, US benchmark crude oil futures have experienced significant volatility, with the average trading price this month standing at around $82 per barrel, compared to around $65 per barrel in February. Therefore, the inflation data for March may be even hotter.
Joseph Brusuelas, Chief Economist at RSM, estimates that, based on a rule of thumb, for every $10 increase in the price of oil per barrel, the Labor Department’s inflation reading would rise by about 0.2 percentage points. Although there are slight differences in the calculations of different economists, most believe that oil prices will push up inflation in March. Economists also believe that due to the missing October housing cost growth data caused by last year’s government shutdown, the current year-on-year inflation reading has been artificially suppressed. However, this downside deviation should disappear in the April inflation report, and the calculated inflation rate will then rise accordingly. (Jin10)
