MBS MID-DAY: 3/16/2012


*CPI +0.4, as expected.
*Core CPI (excludes food/energy) up 0.1 vs +0.2 consensus
*Annual CPI +2.9 and +2.2 at Core, both as expected
*Gas prices = 80 pct of February Rise

The Consumer Price Index for All Urban Consumers (CPI-U) increased
0.4 percent in February on a seasonally adjusted basis, the U.S.
Bureau of Labor Statistics reported today. Over the last 12 months,
the all items index increased 2.9 percent before seasonal adjustment.

The gasoline index rose sharply in February, accounting for over 80
percent of the change in the all items index. The gasoline increase
led to a 3.2 percent rise in the energy index despite a decline in
the index for natural gas. The food index was unchanged in February,
with the food at home index unchanged for the second month in a row
as major grocery store food indexes were mixed.

The index for all items less food and energy rose 0.1 percent in
February after increasing 0.2 percent in January. Indexes for
shelter, new vehicles, medical care, and household furnishings and
operations all advanced, while indexes for apparel, recreation, used
cars and trucks, and tobacco all declined.

The all items index has risen 2.9 percent over the last 12 months,
the same figure as last month. The index for all items less food and
energy was up 2.2 percent, a slight decline from last month’s 2.3
percent figure, while the 12-month change in the food index fell to
3.9 percent in February, its lowest level since last June. In
contrast, the 12-month change in the energy index was 7.0 percent in
February compared to 6.1 percent in January.

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