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U.S. Inflation Not Taking Flight
The slightly delayed January CPI report landed on the right side of market expectations, helping to extend a rally in Treasury markets by putting Fed rate cuts more firmly on the table this year. Helped by cheaper gasoline and a rare dip in electricity costs, consumer prices rose a less-than-expected 0.2% in the month. With few exceptions, most items showed either modest increases or easing pressure. Food costs rose 0.2% m/m, with grocery bills now rising a more normal 2.1% in the past year. Shelter costs also cooled (0.2% m/m) amid easing pressure on rents. Used motor vehicle prices fell sharply for a second ... (full story)