Is the US Headed for More Inflation in 2024?

The last few days have produced a bumper crop of disappointing news on inflation. First, we saw that the Consumer Price Index grew at 0.4 percent in February, the highest monthly increase since September of last year, resulting in a higher-than-expected 3.2 percent overall rate of annualized inflation. Costs for shelter and gasoline, two of the most important categories for households, contributed to the majority (60 percent) of the increase in prices in February. At the same time, the Producer Price Index (PPI) for final demand rose by 0.6 percent for the month, the highest monthly increase since last summer, and contributing to the highest annual rate of increase since September. Import prices have now risen for two months in a row, the first back-to-back monthly increase since the summer of 2023. Finally, global oil prices, a key input into overall price levels, have hit current cycle highs above $80 per barrel in recent days....