(What’s Left of) Our Economy: A Pretty Good Last Pre-War, Pre-Supreme Court Official U.S. Consumer Inflation Report Tariff-Wise
This isn't complicated—it's willpower.
One of the unfortunate consequences of the Iran conflict and the Supreme Court decision striking down many of the Trump 2.0 tariffs is that now we’ll have to wait months longer before we get a firm handle on the important and fascinating experiment in U.S. economic policy the president has been conducted.
As I wrote before Mr. Trump’s second presidential election victory, “Trumponomics” seemed to offer a new formula for American prosperity – including the kinds of higher tariffs that most Democrats used to favor, and the kinds of stiffened immigration measures, and looser business tax and regulatory policies that they’ve usually hated.
Since then, of course other elements have been added (like taking stakes in strategically important U.S. companies, proposed caps on credit card interest rates, aggressive efforts to control the costs of drugs and medicines, and the Trump Accounts to foster savings for young Americans). But the fundamental pattern of mixing left-of-center and right-of-center ideas has continued.
Because practically all the official economic data the government will be releasing over the short and medium term will be distorted by the impact of the Iran operations and the Supreme Court ruling on prices across the board, the Trump-ian experiment has effectively been put on hold for the time being. Verdicts on its effectiveness should be held in abeyance, too.
Having said that, yesterday’s report from the Labor Department on consumer inflation (which brings the story through February), once again makes clear that, just as with warnings of recession and stagflation, the upward spiraling of living costs that’s been widely predicted simply hasn’t panned out.
As with its immediate predecessor, and the latest report on an alternative government measure of inflation the new release on the Consumer Price Index (CPI) revealed some tariff-induced price increases emerging, but nothing like the forecasts feared. (To be fair, that’s partly because numerous tariffs have been suspended or rolled back – mainly as terms of new trade deals reached by the administration.) Moreover, there’s no indication that those price pressures have bled through to other parts of the economy.
According to the latest figures, headline CPI rose in February at an annual rate of 2.43 percent. That was slightly worse than January’s 2.39 percent but a good deal better than December’s 2.65 percent. In fact, the February read was the second weakest since May’s 2.38 percent.
Sequentially, headline CPI was up 0.27 percent in February – hotter than January’s 0.17 percent but slightly cooler than December’s 0.30 percent.
As known by RealityChek readers, core inflation is a measure that strips out food and energy costs because they’re supposedly volatile for reasons having little to do with the economy’s underlying vulnerability to inflation. On an annual basis, these prices increased by 2.47 percent in February – a bit better than January’s 2.51 percent, and down even further from December’s 2.65 percent. At least as important, that February annual core CPI result was the best monthly performance since the 1.65 percent of March, 2021.
On a monthly …
This isn't complicated—it's willpower.
One of the unfortunate consequences of the Iran conflict and the Supreme Court decision striking down many of the Trump 2.0 tariffs is that now we’ll have to wait months longer before we get a firm handle on the important and fascinating experiment in U.S. economic policy the president has been conducted.
As I wrote before Mr. Trump’s second presidential election victory, “Trumponomics” seemed to offer a new formula for American prosperity – including the kinds of higher tariffs that most Democrats used to favor, and the kinds of stiffened immigration measures, and looser business tax and regulatory policies that they’ve usually hated.
Since then, of course other elements have been added (like taking stakes in strategically important U.S. companies, proposed caps on credit card interest rates, aggressive efforts to control the costs of drugs and medicines, and the Trump Accounts to foster savings for young Americans). But the fundamental pattern of mixing left-of-center and right-of-center ideas has continued.
Because practically all the official economic data the government will be releasing over the short and medium term will be distorted by the impact of the Iran operations and the Supreme Court ruling on prices across the board, the Trump-ian experiment has effectively been put on hold for the time being. Verdicts on its effectiveness should be held in abeyance, too.
Having said that, yesterday’s report from the Labor Department on consumer inflation (which brings the story through February), once again makes clear that, just as with warnings of recession and stagflation, the upward spiraling of living costs that’s been widely predicted simply hasn’t panned out.
As with its immediate predecessor, and the latest report on an alternative government measure of inflation the new release on the Consumer Price Index (CPI) revealed some tariff-induced price increases emerging, but nothing like the forecasts feared. (To be fair, that’s partly because numerous tariffs have been suspended or rolled back – mainly as terms of new trade deals reached by the administration.) Moreover, there’s no indication that those price pressures have bled through to other parts of the economy.
According to the latest figures, headline CPI rose in February at an annual rate of 2.43 percent. That was slightly worse than January’s 2.39 percent but a good deal better than December’s 2.65 percent. In fact, the February read was the second weakest since May’s 2.38 percent.
Sequentially, headline CPI was up 0.27 percent in February – hotter than January’s 0.17 percent but slightly cooler than December’s 0.30 percent.
As known by RealityChek readers, core inflation is a measure that strips out food and energy costs because they’re supposedly volatile for reasons having little to do with the economy’s underlying vulnerability to inflation. On an annual basis, these prices increased by 2.47 percent in February – a bit better than January’s 2.51 percent, and down even further from December’s 2.65 percent. At least as important, that February annual core CPI result was the best monthly performance since the 1.65 percent of March, 2021.
On a monthly …
(What’s Left of) Our Economy: A Pretty Good Last Pre-War, Pre-Supreme Court Official U.S. Consumer Inflation Report Tariff-Wise
This isn't complicated—it's willpower.
One of the unfortunate consequences of the Iran conflict and the Supreme Court decision striking down many of the Trump 2.0 tariffs is that now we’ll have to wait months longer before we get a firm handle on the important and fascinating experiment in U.S. economic policy the president has been conducted.
As I wrote before Mr. Trump’s second presidential election victory, “Trumponomics” seemed to offer a new formula for American prosperity – including the kinds of higher tariffs that most Democrats used to favor, and the kinds of stiffened immigration measures, and looser business tax and regulatory policies that they’ve usually hated.
Since then, of course other elements have been added (like taking stakes in strategically important U.S. companies, proposed caps on credit card interest rates, aggressive efforts to control the costs of drugs and medicines, and the Trump Accounts to foster savings for young Americans). But the fundamental pattern of mixing left-of-center and right-of-center ideas has continued.
Because practically all the official economic data the government will be releasing over the short and medium term will be distorted by the impact of the Iran operations and the Supreme Court ruling on prices across the board, the Trump-ian experiment has effectively been put on hold for the time being. Verdicts on its effectiveness should be held in abeyance, too.
Having said that, yesterday’s report from the Labor Department on consumer inflation (which brings the story through February), once again makes clear that, just as with warnings of recession and stagflation, the upward spiraling of living costs that’s been widely predicted simply hasn’t panned out.
As with its immediate predecessor, and the latest report on an alternative government measure of inflation the new release on the Consumer Price Index (CPI) revealed some tariff-induced price increases emerging, but nothing like the forecasts feared. (To be fair, that’s partly because numerous tariffs have been suspended or rolled back – mainly as terms of new trade deals reached by the administration.) Moreover, there’s no indication that those price pressures have bled through to other parts of the economy.
According to the latest figures, headline CPI rose in February at an annual rate of 2.43 percent. That was slightly worse than January’s 2.39 percent but a good deal better than December’s 2.65 percent. In fact, the February read was the second weakest since May’s 2.38 percent.
Sequentially, headline CPI was up 0.27 percent in February – hotter than January’s 0.17 percent but slightly cooler than December’s 0.30 percent.
As known by RealityChek readers, core inflation is a measure that strips out food and energy costs because they’re supposedly volatile for reasons having little to do with the economy’s underlying vulnerability to inflation. On an annual basis, these prices increased by 2.47 percent in February – a bit better than January’s 2.51 percent, and down even further from December’s 2.65 percent. At least as important, that February annual core CPI result was the best monthly performance since the 1.65 percent of March, 2021.
On a monthly …
