U.S. inflation data on Wednesday were in line with expectations, bolstering expectations that the Federal Reserve will keep interest rates steady not just at its March 18 meeting but most likely at its April meeting.
The consumer price index (CPI) rose by 0.3% in February, according to a report from the Bureau of Labor Statistics. Economists forecast growth of 0.3%, after rising 0.2% in January.
Compared with the same period last year, CPI rose 2.4%, higher than the 2.4% expected and 2.4% in January.
Core CPI, which excludes food and energy costs, rose 0.2% in February, compared with expectations for a 0.2% increase and from 0.3% in January. Core CPI rose 2.5% year-on-year, higher than the 2.5% expected and 2.5% in January.
Amid moderate pressure in the morning, Bitcoin Within minutes of the report, the company was trading at $69,500, down 1.2% in the past 24 hours.
U.S. stock index futures edged lower across the board, with the 10-year Treasury yield rising slightly to 4.18%. WTI crude oil, the star of the market this week, rose 4.2% to $87 a barrel.
According to the CME FedWatch tool, before the data was released, the market expected a 99% chance that the Federal Reserve would keep interest rates unchanged at next week’s March meeting. At the April meeting, the odds of a rate cut were just 11%, compared with 21% a month ago.
Of course, February’s inflation data is already somewhat out of date given what has happened since then, namely the Iran war and soaring oil prices. How this affects the Fed’s interest rate thinking should become more apparent after next week’s policy meeting.