Inflation ticked higher across the US last month as Joe Biden puts the economy at the heart of his re-election bid.
The consumer price index rose at an annual pace of 3.2% in February, up slightly from 3.1% the previous month.
Economists had expected a reading of 3.1%. Policymakers at the Federal Reserve are working to bring inflation down to 2%.
On the month, the index rose by 0.4% in February. This was also up slightly from 0.3% the previous month.
The so-called “core” consumer price index, a closely watched measure of inflation which removes volatile food and energy costs, slipped from an annual rate of 3.9% in January to 3.8% last month.
The strength of this reading is likely to test confidence that the Fed, which aggressively increased interest rates in a bid to reduce inflation, could soon begin cutting them.
Shelter costs like rent, airline fares, motor vehicle insurance and the price of clothes all rose last month, according to Tuesday’s report from the labor department, driving the headline inflation indices higher.
Some grocery prices decreased, however, including dairy products and fruit and vegetables.
While the president claimed during his State of the Union address last week that the US economy was “literally the envy of the world”, many Americans are still feeling the pinch.
Inflation has fallen significantly since peaking at 9.1% – its highest level in a generation – almost two years ago, but household budgets remain under pressure.
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When the Fed first started increasing rates to cool price growth, many economists suggested the US was at risk of recession. The economy has remained resilient, however, and the White House is confident a downturn will be averted.
“The landing is, and will be, soft,” Biden told Congress last Thursday. “It takes time, but the American people are beginning to feel it. Consumer studies show consumer confidence is soaring.”
Donald Trump, who is fighting to regain the presidency in November, has claimed inflation is “killing America” under Biden.
