Trump receives a break on inflation while markets prepare for further tariff turmoil
Seema Shah, the chief global strategist at Principal Asset Management, commented, “This may be the calm CPI report before the storm.”
TroibNews 
Consumer prices showed a decline in February, providing positive news for President Donald Trump as markets navigate new tariffs that economists caution could lead to inflationary pressures.
According to the Labor Department, the Consumer Price Index increased at an annual rate of 2.8 percent in February, which was a slower rise than many analysts had projected. Core inflation, which excludes the more volatile food and energy sectors, increased by 3.1 percent, slightly under the 3.2 percent forecasted by most economists.
Despite significant spikes in prices for grocery essentials like meat and eggs — impacted by avian flu outbreaks — the annual rise in food prices was 2.6 percent, lagging behind the general inflation rate. Additionally, gasoline prices saw a decline in the previous month.
In reaction to the positive report, the Trump War Room, part of the president’s political strategy team, took to the social media platform X to declare, “PROMISES MADE, PROMISES KEPT!”
However, this could be the last monthly inflation report indicative of a pre-tariff economy. A new 25 percent tariff on global steel and aluminum imports to the U.S. was implemented overnight, prompting retaliatory measures from major European trading partners, affecting exports of various products including meat, poultry, and women's lingerie.
“It’s worth remembering that this may be the calm CPI report before the storm,” remarked Seema Shah, chief global strategist at Principal Asset Management, in a research note issued shortly after the report's release. “Not only does the Fed need to wait for tariff policy clarity, but once tariff implementation arrives it is likely to bring at least some price increases, with the inflation picture potentially getting uglier as the months go on. The Fed — and markets — are not yet in the clear.”
Over the past two weeks, the markets have been unsettled by a spate of tariff announcements and reversals that have created obstacles for businesses planning to hire or invest in new projects. Wall Street banks have increased the likelihood of a recession, yet Trump administration officials have consistently stated that the president will remain committed to his plans for transforming global trade.
“The president wants the American people to have so much money in their pockets they don’t know what to do with it,” Press Secretary Karoline Leavitt conveyed to reporters during a briefing on Tuesday.
Allen M Lee for TROIB News
According to the Labor Department, the Consumer Price Index increased at an annual rate of 2.8 percent in February, which was a slower rise than many analysts had projected. Core inflation, which excludes the more volatile food and energy sectors, increased by 3.1 percent, slightly under the 3.2 percent forecasted by most economists.
Despite significant spikes in prices for grocery essentials like meat and eggs — impacted by avian flu outbreaks — the annual rise in food prices was 2.6 percent, lagging behind the general inflation rate. Additionally, gasoline prices saw a decline in the previous month.
In reaction to the positive report, the Trump War Room, part of the president’s political strategy team, took to the social media platform X to declare, “PROMISES MADE, PROMISES KEPT!”
However, this could be the last monthly inflation report indicative of a pre-tariff economy. A new 25 percent tariff on global steel and aluminum imports to the U.S. was implemented overnight, prompting retaliatory measures from major European trading partners, affecting exports of various products including meat, poultry, and women's lingerie.
“It’s worth remembering that this may be the calm CPI report before the storm,” remarked Seema Shah, chief global strategist at Principal Asset Management, in a research note issued shortly after the report's release. “Not only does the Fed need to wait for tariff policy clarity, but once tariff implementation arrives it is likely to bring at least some price increases, with the inflation picture potentially getting uglier as the months go on. The Fed — and markets — are not yet in the clear.”
Over the past two weeks, the markets have been unsettled by a spate of tariff announcements and reversals that have created obstacles for businesses planning to hire or invest in new projects. Wall Street banks have increased the likelihood of a recession, yet Trump administration officials have consistently stated that the president will remain committed to his plans for transforming global trade.
“The president wants the American people to have so much money in their pockets they don’t know what to do with it,” Press Secretary Karoline Leavitt conveyed to reporters during a briefing on Tuesday.
Allen M Lee for TROIB News
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