❓WHAT HAPPENED: The Consumer Price Index (CPI) rose just 2.4 percent in January compared to the same month last year, marking the slowest pace of inflation since May 2025.
👤WHO WAS INVOLVED: The Bureau of Labor Statistics and U.S. consumers.
📍WHEN & WHERE: January 2026, with data released Friday, February 13, 2026, following a delayed report due to a recent government shutdown.
🎯IMPACT: Easing inflation may provide some relief to consumers, though many still feel burdened by rising costs of living.
The Consumer Price Index (CPI) increased by just 2.4 percent in January compared to the previous year, according to data released by the Bureau of Labor Statistics on Friday. This marks the slowest annual inflation rate since May 2025 and is a decrease from December’s 2.7 percent pace.
Economists polled by FactSet had forecast a 2.5 percent rise in January’s CPI. While food and shelter costs climbed at a faster rate, a 1.5 percent decline in energy prices helped offset the overall inflation rate.
Core inflation, which excludes volatile food and energy prices, rose 2.5 percent over the past 12 months. The CPI measures changes in the cost of a basket of goods and services commonly purchased by consumers, such as food and clothing.
The delayed release of January’s inflation report was due to the recent partial government shutdown.
While inflation continues to ease, the news could throw cold water on hopes that the Federal Reserve will begin a new interest rate-cutting cycle this year after the central bank decided to pause rate cuts in January. Incoming Fed chairman Kevin Warsh is likely to initiate another rate cut or two, but whether the central bank pushes much lower remains to be seen.
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