The United States Labor Department reported that the consumer price index rose for the first time in four months this past February. Overall prices were up 0.2% from January, despite being flat from a year ago. At the same time, newly built home sales surged 8% this February, which is the highest level since early 2008 according to the Commerce Department. Sustained pickup could encourage builders to increase construction. This touches on two areas that the Fed is monitoring closely: the housing market, which policy makers view as slow despite cheap mortgage rates; and inflation, which has been below the Fed’s target for the past three years. The Fed has suggested it will raise interest rates later this year if the labor market and inflation strengthen. Inflation is expected to remain low in the short-run, as a strong dollar lowers the price of imports and low energy prices. Core prices, which exclude food and energy, have climbed 1.7% over the past year. The rise in core prices has been driven largely by higher costs for housing. What do you think about this information in context of the Fed’s inflation concerns?