US inflation slowed more than expected in February, with core inflation posting its smallest gain since 2021 — although the data was gathered before President Trump began to ramp up his tariff wars this month.

US inflation fell more than expected to 2.8 per cent in February, bolstering the case for Federal Reserve to cut interest rates amid signs of slowing growth in the world’s largest economy. Wednesday’s annual consumer price index figure was below both January’s 3 per cent and the 2.9 per cent expected by economists, according to a Reuters poll.

U.S. consumer prices increased moderately in February as higher shelter costs were partially offset by cheaper airline fares, giving the Federal Reserve room to keep interest rates unchanged next week while monitoring the economic impact of a trade war.