January U.S. CPI Report Shows Inflation at a 3.1% Annual Rate, Hotter Than Expected

The Bureau of Labor Statistics reported that the Consumer Price Index climbed 3.1% in January from year-ago levels—a decrease from December’s 3.4% rate, but well below the January 2023 peak of 6.4%.

However, the January increase was faster than economists had predicted.

Core CPI, which excludes volatile food and energy costs, rose 3.9% in January over the last 12 months after rising 3.9% in December.

The CPI increased 0.3% in January from month-ago levels after rising 0.2% in December. Core CPI increased 0.4% after rising 0.3% in December.

January CPI Report Key Stats

• CPI increased 0.3% for the month after rising 0.2% in December.
• Core CPI rose 0.4% after growing by 0.3% in December.
• CPI rose 3.1% year over year after increasing by 3.4% the prior month.
• Core CPI increased 3.9% from year-ago levels after increasing 3.9% in December.

Economists had forecast the overall CPI reading to show an increase of 2.9% on an annual basis in January, and for core CPI to rise 3.7%. For the month, CPI had been forecast to rise 0.2% overall and 0.3% excluding food and energy.

Food prices rose 0.4% in January after increasing 0.2% in December. Food-at-home prices increased 0.4% over the month, while food-away-from-home (restaurant) prices increased 0.5%.

Energy prices were mixed overall for the month after falling 0.2% the prior month. Utility (piped) gas service prices gained 2.0%, fuel oil prices declined 4.5%, gasoline prices declined 3.3%, and electricity prices climbed 1.2%.

In January, shelter prices climbed 0.6% after rising 0.4% in December.

This article was partially generated by Wordsmith, an automated smart-text platform, using data from the Bureau of Labor Statistics. The article has been reviewed by Morningstar editors.