Feb. 9 (UPI) — The U.S. Bureau of Labor Statistics on Friday revised down inflation measured by the Consumer Price Index from initial levels reported last month.
The revised data placed gains in December CPI inflation at 0.2%, a slight drop from the originally reported 0.3% for December, according to the BLS.
The BLS updates its formula for tracking prices and calculating inflation each February, however the revisions are often minuscule.
The revised data also showed CPI core inflation at 3.25% over the past six months up from 3.21% in the initial report, while the annualized rate of 3.3% in the past three months was unchanged.
The Federal Reserve’s preferred PCE inflation index finished 2023 at 2.9%. The PCE inflation rate was 1.9% at an annual rate during the second half of 2023 down from 4% during the first half of the year, driving expectations that the Fed will begin cutting interest rates.
According to economists at Evercore ISI, the revised inflation numbers increase the likelihood that the Federal Reserve could begin cutting interest rates as soon as May.
“This changed composition will be welcome inside the Fed. Policymakers want more evidence that housing services and core services ex-housing are cooling enough to underwrite a sustained return to 2% inflation even if goods inflation moves back to around zero,” the Evercore economists said.
The revised inflation numbers sent stocks a bit higher with the S&P up 0.2% to 5,009 while the Dow was nearly flat, showing a dip of 0.14% Friday morning.
The S&P topped 5,000 for the first time Thursday before dipping again slightly prior to the revised CPI numbers being released.
