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Special Report

Inflation Research Brief

February 2024

While Challenging for the Fed, Strong Demand for
Services is a Positive Sign for CRE

Inflation metrics present mixed bag. The headline Consumer Price Index rose 3.1 percent over the year ended January, down 30 basis points from the December reading. Falling energy prices and flattening costs for food helped slow inflation, as supply chains remained fluid despite ongoing global conflict. However, when stripping these indices out, the core CPI measure held at 3.9 percent over the year ended January, the same annual rate as last month. While sustained core pricing pressures reduced investor expectations for a rate cut in March, the trend is signaling — amid elevated wage and GDP growth — that the economy is still running hotter than the Fed intends. Yet, this presents positive implications for commercial real estate in 2024.  

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