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Just out, the Consumer Price Index for February and it shows that inflation cooled slightly for the month. Government figures show it rose .4% which brings the annual inflation rate down to 6%. It was 6.4% last month. \xa0 Hi, I'm Kathy Fettke and this is Real Estate News for Investors. Please remember to subscribe to this podcast and leave us a review. \xa0 The report on the CPI also shows a .5% rise in the core rate of inflation, which omits volatile pricing for food and energy. That\u2019s slightly higher than a .4% estimate for the core rate, but the annual core rate of 5.5% was inline with expectations.\xa0 \xa0 Economists Expect Soften Fed Policy \xa0 Overall, inflation went down in February, but likely not enough to prevent another rate hike when the Federal Reserve meets next week. Economists expect the banking turmoil to soften the Fed\u2019s stance however. \xa0 The head of Evercore ISI\u2019s global policy and central bank strategy, Krishna Guha, told CNBC: \u201cWhile only moderately higher than consensus, in the pre-SVB crisis world this may well have pushed the Fed to hike 50 basis points at its March meeting next week. It is a sign of how much things have changed in the very near term that 50 basis points is almost certainly off the table for March.\u201d \xa0 Economists started predicting a 50 basis point rate hike after hawkish comments by Fed Chief Jerome Powell when he testified before two congressional committees. During two days of testimony, Powell said that interest rates will probably be \u201chigher than previously anticipated.\u201d\xa0 \xa0 After the failure of Silicon Valley Bank and two other banks, economists now expect the Fed to back off a bit, but not completely. Jeffrey Roach, who\u2019s the chief U.S. economist at LPL Financial told CNBC: \u201cEven amid current banking scares, the Fed will still prioritize price stability over growth and likely hike rates by .25% at the upcoming meeting. \xa0 Inflation Rate Varies from Sector to Sector \xa0 When you break the report down into sectors, you see that lower energy prices helped bring the overall rate down. Energy prices were down .6% in February, to an annual rate of 5.2%. Food prices were up .4% although egg prices tumbled. They were down 6.7% but are still up 55.4% on a year-over-year\xa0 basis. \xa0 Shelter costs were .8% higher which brought the annual rise in shelter prices to 8.1%. Shelter costs make up about one third of the CPI, but fed officials expect those costs, including rent growth, to slow down throughout the year. \xa0 As Bright MLS chief economist, Lisa Sturtevant, told CNBC: \u201cHousing costs are a key driver of the inflation figures, but they are also a lagging indicator. It typically takes six months for new rent data to be reflected in the CPI.\u201d She says the fact that the data is six months old means that inflation levels are not accurately reflecting current rates of inflation.\xa0 \xa0 Moody\u2019s: Six Banks at Higher Risk of Failure \xa0 Fed officials will be taking this report into consideration at their meeting, along with other newly released economic data and the risk to the banking system. Moody\u2019s released a list of six banks that it considered at higher risk of failure because of the current economic environment. Those banks include: First Republic Bank, Zions, Western Alliance, Comerica, UMB Financial and Intrust Financial. (2) \xa0 Economist Gus Faucher of PNC Financial Services told MarketWatch: \u201cWhat was a tricky task for the Fed, raising rates by enough to cool off inflation, but not by too much as to push the economy into recession, has gotten even more difficult with the recent bank failures.\u201d (3) \xa0 Check the show notes at newsforinvestors.com for links to our sources. I also encourage you to join RealWealth for free. When you become a member, you have access to more than just the Learning Center. You\u2019ll be able to log in to the Investor Portal where you\u2019ll find data on some of the best rental markets in the country, along with sample properties for sale to investors. Members also have access to our experienced investment counselors, and our list of property teams and other real estate professionals that can help put you on the path to financial freedom. \xa0 Thanks for listening, Kathy Fettke \xa0 Links: \xa0 1 - https://www.cnbc.com/2023/03/14/cpi-inflation-february-2023-.html \xa0 2 - https://www.cnn.com/2023/03/14/investing/moodys-us-banks-downgrade/ \xa0 3 - https://www.marketwatch.com/story/cpi-shows-slightly-cooler-u-s-inflation-but-pressure-still-on-fed-to-raise-rates-fe88e2f5