SOTS 2nd Hour: February CPI Report, A Historic Oil Release, & Oracle's Big Bump 3/11/26

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Sara Eisen (0:58)

Good Wednesday morning. Welcome to Squawk on the Street. I'm Sara Eisen with Carl Quintanilla and Mike Santoli. We are live at Post 9 of the New York Stock Exchange. David Faber's off today. Coming up this hour, the head of the International Energy Agency, IEA, expected to deliver remarks in just a few moments, will be all over the wild volatility in oil, with energy expert Paul Sankey, who says, we're seeing a nightmare scenario play out. Plus, Council on Foreign Relations President Emeritus Richard Haass with us to talk about how the war could come to an end.

And Oracle, a winner today on Strong Earnings and Guidance, will ask an analyst if this is the start of a bigger turnaround for that stock, which is surging more than 12%. But guys, we got the CPI report. And yes, this doesn't incorporate the war in Iran and the big spike in oil prices and gas prices, but I do think it's worth noting because we want to know what the underlying trend of inflation heading into this gas pump price spike. So I think the key is that the core overall CPI, at 2.5% in February, was good news. Why? Because it was a moderation. It was the lowest level we've seen year over year since 2021 That's good. Core, remember, strips out food and energy. It's kind of the underlying trend that the Fed watches. And there's the picture of basically where we've been, which is very high. There's the spike in 2022, 2023, and how we have come down to more normalized level. Are we at the Fed's 2% level?

Steve Witkoff (2:23)

No.

Sara Eisen (2:24)

But we have come down, and that I think the 2.5%, this is lowest pace in five years, is very good news. The overall metric increased 0.3% for the month, and it's 2.4% for the prior year. You had some big, heavy weights in the categories that were better. For instance, used car prices, which always is a big weight. That was better. The goods prices, you know, for all the talk about inflation and tariffs, goods prices barely rose. There was some tariff pass-through, I think you could see, in apparel prices, for instance. Appliances, furnishing prices, audio equipment had some weird spike, but overall goods prices were tame. Here's some of the parts that I picked up in terms of the biggest monthly increases from January to February. If you've been making salads, lettuce prices spiked, tomato prices spiked. That was the big 4% increase in fresh vegetables. There's the appliances and apparel that I mentioned. But overall, and now we can look on the flip side at some of the biggest subtractors.

Carl Quintanilla (3:22)

By the way, that apparel number is the biggest month on month increase in like eight years.

Sara Eisen (3:26)

Well, remember all those retailers that were telling us that we haven't seen the worst of the tariff pathway on inflation. They hoarded all the inventories going into tariffs and coming in as we started. And they are starting to pass it on. So we expected that the sort of worst hit of it in terms of the price increases would be around now. But I think it's important to state that overall goods prices, they barely rose outside of some of those key categories. Services is still where, you know, that continues to be where the pain is. But even there, we saw some easing in terms of auto insurance, for instance, and some of the health insurance gains. So Mike, it doesn't change anything for the Fed. They're probably on hold. And we're all bracing for this next March report, which is going to show the spike in gas prices. But underlying trends, I think it would have been a bigger market deal if we saw a bigger acceleration.