Inflation eased a bit last month, but President Trump's trade war is raising concerns about the cost of living outlook.
Consumer prices in February were up 2.8% from a year ago, according to a report Wednesday from the Labor Department. That's a smaller annual increase than the 3% recorded in January, and slightly smaller than forecasters had expected.
Prices rose 0.2% between January and February, compared to a jump of 0.5% the previous month.
Falling gasoline prices helped to keep the overall inflation rate in check last month. Grocery prices also held steady, although egg prices continued to climb at a double-digit pace. Egg prices have been soaring as avian flu weighs on the nation's flock of egg-laying hens.
The cooling inflation rate should come as a relief to watchdogs at the Federal Reserve. Nevertheless, the central bank is expected to hold interest rates steady when policymakers meet next week.
The inflation report comes on the same day that Trump imposed 25% tariffs on all imported steel and aluminum. Those tariffs and other import taxes levied or threatened by the president could add to inflationary pressures and make it harder to bring inflation under control.
The tariffs have also invited retaliation from U.S. trading partners, which could be damaging for U.S. exporters. On Wednesday the European Union hit back at the steel and aluminum tariffs, targeting up to 26 billion euros, or $28 billion of U.S. goods.
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