Overview
- Consumer prices rose 0.2% on the month and 2.4% year over year, with core CPI up 0.3% monthly and 2.5% annually, the smallest core increase since March 2021.
- Gasoline fell 3.2% in January and used cars dropped 1.8%, while shelter rose 0.2% on the month and 3.0% from a year earlier.
- Equities climbed and Treasury yields eased as traders boosted the odds of rate cuts later in 2026, even as policymakers seek more evidence of sustained disinflation.
- Services costs showed pockets of firmness, including a 6.5% jump in airfares and higher prices for some personal care and streaming subscriptions.
- The report followed a stronger-than-expected January jobs gain of 130,000 and came alongside research showing U.S. firms and consumers bear nearly 90% of tariff costs; separately, India’s rebased CPI (2024=100) put January inflation at 2.75%.