JUST IN: Inflation declines to 6% in February in sigh of relief for economy
The much-anticipated numbers from the consumer price index show that, while inflation is much too high, it is cooling in response to the Fed's aggressive interest rate hikes.
Meanwhile, “core inflation,” which strips out volatile food and energy prices, was at 5.5% in the year ending in February. The news comes amid heightened tensions in the financial sector after the Federal Deposit Insurance Corporation announced on Friday that Silicon Valley Bank, known as SVB, had failed and been taken into government hands, followed by crypto lender Signature Bank on Sunday. Officials provided reassurances over the weekend that the banking system was sound.
The Fed will meet next week to decide whether to raise interest rates, with some expressing concern that if it does hike rates once again, it could lead to a recession. Investors were hoping for a cooler CPI report this week so that the Fed might hold off on hiking this month, given the SVB collapse.
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