The consumer price index in January fell to 3.1% year-over-year growth, down from the 3.4% rise in December but higher than analyst's predictions of 2.9%. The annual figure, which tracks the change in prices of a basket of goods and services, is the lowest increase since June (see historical data).
Prices increased by 0.3% on a month-to-month basis, an increase over last month's 0.2%, which complicates the Federal Reserve's plans to cut interest rates this year. Housing was the biggest contributor to overall inflation, rising 0.6% for the month and 6% for the year, and accounting for two-thirds of January's gain. Core CPI, which excludes food and energy prices, increased by 0.4% on the month and 3.9% on the year. See all data here.
The reading likely pushes the Fed's first cut to the benchmark federal funds rate—which has been at a range between 5.25% and 5.5% for six months—to June or July. Learn how the federal funds rate is set here.
Comments