The rate of monthly inflation, as measured by the Federal Reserve’s preferred personal-consumption expenditures (PCE) price index, accelerated in February, according to data released Thursday by the Commerce Department. This increase occurred prior to the onset of the conflict in Iran, indicating inflationary pressures were already present.

The PCE price index rose 0.4% in February, up from a 0.3% gain in January. The core PCE index, which excludes volatile food and energy prices, also increased by 0.4% for the month, aligning with market expectations. On an annual basis, the headline PCE inflation rate held steady at 2.8%, while the core annual rate edged slightly lower to 3.0% from 3.1%.

The Federal Reserve targets a 2% inflation rate measured by the PCE gauge, a threshold that has been exceeded for nearly five years. Despite the persistence of elevated inflation, the February figures provided limited new insight for investors, as the PCE data tend to closely mirror other publicly available economic indicators.

Importantly, this report predates the outbreak of hostilities in Iran, a development widely anticipated by analysts to contribute to higher costs, particularly in fuel and commodity markets. The geopolitical tensions have since raised concerns about further upward pressure on inflation.

Investors and analysts will turn their attention to the upcoming consumer-price index (CPI) report, scheduled for release by the Labor Department on Friday, for additional information on inflation trends heading into March.