Trump Halted Producer Inflation And Reduced Core Prices Drop In First Month.

Trade tariffs imposed by President Donald J. Trump have not caused a rise in inflation, despite claims in the corporate media that foreign import levies would drive up production costs for American manufacturers and prices for consumers. In February, the core producer price index (PPI) for final demand in the U.S. decreased by 0.1 percent, signaling a decline in prices for goods and services, excluding food and energy.

The broader PPI remained unchanged during the same period, showing no inflation overall for the month. Economists had predicted a 0.3 percent increase in the broad PPI and a 0.5 percent rise in core prices. However, these projections were not met, with the data indicating price stability and a reduction in core prices instead.

Notably, the PPI measures prices that U.S. businesses receive for goods, services, and construction, although it excludes export prices and sales taxes. It offers a different perspective from the consumer price index (CPI), which reflects prices paid by U.S. consumers and includes sales taxes but excludes those paid by businesses and government entities. February’s CPI and core consumer prices both increased by 0.2 percent—showing minimal change in inflation.

While the PPI and core PPI remain up 3.2 and 3.4 percent, respectively, from a year ago—signaling that inflationary pressures continue to linger—this is mostly attributable to a lag effect from the high rate of inflation experienced under former President Joe Biden.

Additionally, goods prices rose by only 0.3 percent in February compared to January’s higher rate, while services prices fell by 0.2 percent.

Image by Gage Skidmore.

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