CPI for February 2025

The consumer price index rose by 3.2% compared to the previous year, remaining unchanged from January 2025.

In February 2025, the CPI increased by 0.9% month-over-month. The primary contributors to the annual inflation rate were housing and utilities (4.4% and accounting for 1.0%), and food and non-alcoholic beverages (2.8% and contributing 0.5%). In February 2025, the annual inflation rate for goods was 2.5%, up from 2.4% in January 2025, while the services inflation rate was 3.8%, down from 4.0% in January 2025.

The Monetary Policy Committee (MPC) will also be closely monitoring average inflation expectations for the next two years, a crucial factor in its decision-making process. These expectations have risen to 4.7% in the first quarter of 2025, up from 4.6% in the previous quarter. The MPC prefers to maintain expectations at the midpoint of its 3% to 6% target range. The reading of the CPI report could persuade the central bank’s monetary policy committee to maintain its key interest rate at 7.5% after the conclusion of its meeting on Thursday. This decision follows three previous quarter-point cuts.

Since the MPC’s last decision in January, there has been an escalation in US President Donald Trump’s rhetoric and tariff measures against neighbouring countries, allies, and competitors. Given the current global uncertainty, the MPC is likely to adopt a “wait and see” approach. Economists polled by Reuters believe that the reserve bank may pause its rate-cutting cycle due to the risks associated with US President Trump’s tariff war and the impasse in the ruling coalition over the country’s national budget.