Inflation remains stable in February according to the PCE index with a year-on-year rate of 2.8%

The pace of U.S. inflation remained steady in February and stood at 2.5% on a year-over-year basis, in line with analysts' expectations, according to the PCE index released Friday.

Core inflation, which excludes volatile food and energy prices, rebounded to 2.8% (up from 2.7% in January), according to this index compiled by the Commerce Department.

Analysts had expected the PCE index to be in this range, according to the consensus published by Market Watch, with the exception of core inflation, higher than expected.

In February, only part of the new tariffs announced by President Donald Trump went into effect. Economists expect these rate hikes on imports to generate a sudden spike in inflation.

On Thursday, Boston Fed President Susan Collins said a rate hike seemed "inevitable," at least "in the near term."

At the end of its last meeting on March 19, the Fed (U.S. central bank) decided to hold its rates while it analyzes the effects of the executive's policies.

Its authorities also lowered their economic forecasts for the world's largest economy. They estimated, for example, that by the end of 2025 inflation will be higher than what they had forecast in December, at 2.7% in one year.

Escalating import tariffs, which have lately hit automobiles and their components, unnerved markets about their possible impact on U.S. businesses and households, even though the economy was still booming in 2024.

Several indicators have shown that U.S. consumer confidence has plummeted since Trump's return to the White House.

After a drop in January, attributed in part to cold weather, consumption began to rise again in February (by 0.4% month-over-month), according to Friday's release.

Incomes grew faster than analysts expected, by 0.8% month-over-month.