Inflation eased a bit last month, but analysts are wary

The latest consumer price index shows that inflation eased a bit last month, rising just 0.2%.

But whether this is the beginning of a downward trend is in doubt as tariffs are just starting to take effect.

The overall index also increased at a slower pace. In the 12 months through February, consumer prices rose 2.8%, which is down from 3% the month before.

But that reflects prices before tariffs took effect, and analysts say we are not out of the woods yet.

“What we really need to see is sustained improvement on inflation,” said Greg McBride of Bankrate.

McBride called the latest consumer price index of 2.8% only a baby step in the right direction.

“And what we need to see is inflation month after month after month, easing lower, working its way closer to 2%,” he said.

And that is something analysts do not see happening.

“The latest inflation numbers don’t take into account the tariffs that are coming up, and so those could really spike inflation again,” said John Kiernan of WalletHub.

So don’t expect the Fed to make a move on interest rates any time soon.

“The Federal Reserve meets next week. And so, while we did see better than expected news on the inflation front, at this point, they’re still going to be firmly planted on the sidelines,” said McBride.

While also looking at the labor market and overall economic growth, WalletHub also looked at how cities are impacted by inflation. Philadelphia is near the top ten, coming in at number 11 on the list.

“Philadelphia is one of the major cities getting hit hardest by inflation,” said Kiernan. “It kind of indicates the area is under unique pressures for consumers’ goods and pricing.”

To fight back, WalletHub said to consider getting a debit or credit card that will give you up to 6% cash back on things like groceries and gas.

“You can even earn an initial bonus worth $200 to even up to $1,000 if you redeem for travel. And so those extra bonuses, if you can use them by spending normally and not racking up interest, can save you a ton of money on everyday goods, which can kind of effectively fight back against the inflation,” said Kiernan.

But in order for a cash-back debit or credit card to save you money, you must use it responsibly. You can’t spend more than you would without it, and you have to pay it off in full every single month.