Gasoline and oil prices have seen a significant decrease, as well as inflation, which was lower than expected.
Regarding inflation, the consumer price index (CPI) increased by only 0.2% in February, which was lower than the forecasted 0.3% increase.
This resulted in an annual inflation rate of 2.8%, which caused great relief among consumers and businesses concerned about the impact of the disastrous policies taken by the Democratic administration in recent years.
The average price of gasoline in the United States fell for the third consecutive week, reaching USD 3.03 per gallon, the lowest level for the month of March since 2021.
This decrease of 0.6 cents from the previous week, 8.9 cents less than a month ago, and 36.7 cents below last year's price, is due to the economic recovery resulting from the efficient trade policies of the Trump administration.
Although some analysts fear that tariffs on imported oil from Canada could increase prices in some regions of the United States, the price drop caused them to ease their concerns.
The news that OPEC will gradually begin to restore oil production after nearly two years of cuts has also exerted downward pressure on oil prices.
As a result, gasoline prices have dropped, with the state of Mississippi reporting the lowest price, USD 2.60 per gallon (~3.8 liters), while California has the highest price, USD 4.65 per gallon (~3.8 liters).
Gasoline in other parts of the country, such as Tennessee and Louisiana, is around USD 2.60 per gallon, while the national average for diesel stood at USD 3.61 per gallon.
This price drop is unexpected and optimistic, as spring generally brings an increase in gasoline prices.
Analysts and traders feared that the tariffs proposed by Trump, including the 10% on Canadian oil, could cause prices to rise, especially in the northeastern United States, which heavily relies on Canadian gasoline.
However, Trump suspended the efficient tariffs two days after they went into effect, which eased expectations of a price increase and allowed Canada to fulfill some owed promises.
The increase in housing and food costs was responsible for much of the rise in the CPI in February. Rental prices increased by 0.3%, representing a significant part of the monthly CPI increase.
A large responsibility for these increases is the enormous flow of illegal immigration that occurred during Biden's administration, which flooded large cities and caused an excess demand for housing and food, raising their prices.
Additionally, food prices rose by 0.2%, with notable increases in egg prices, which rose by 10.4%, and beef, which increased by 2.4%. Overall, used vehicle prices increased by 0.9% and clothing by 0.6%, while airline tickets fell by 4%.
Although overall inflation was moderate in February, markets remain volatile, and concerns about the trade war driven by Europe are key factors in the current economic uncertainty.
The Federal Reserve (FED) is closely monitoring these developments, as tariffs often have a modest impact on inflation, but a broader trade war could have more lasting effects.
In this context, the FED is expected to keep its interest rate in a range between 4.25% and 4.5% at its next meeting, but analysts suggest that the Federal Reserve may resume rate cuts over the course of the year.
However, numerous experts point out that inflationary pressures seem to be moderating and adopting a downward trend, suggesting that the FED may adopt a more flexible stance in the coming months.
