In the United States, inflation has declined for the seventh consecutive month, yet prices continue to climb far more rapidly than is deemed healthy.
Inflation, the rate at which prices increase, was 6.4% in the 12 months preceding January, as housing, food, and energy prices increased.
This was a minor decrease from 6.5% in December.
Despite recent signs of improvement, officials have cautioned that stabilizing prices will take time.
In January of 2023, the annual inflation rate in the United States dropped to 6.4% from 6.5% in December, below market expectations of 6.2%. Nonetheless, this is the lowest reading since October 2021.
Food prices slowed (10.1% vs. 10.4%) while the price of old vehicles and trucks continued to fall (-11.6% vs. -8.4%). In contrast, the cost of housing climbed more rapidly (7.9% vs. 7.5%), as did the cost of energy (8.7% vs. 7.3%), with gasoline prices up 1.5%, reversing December’s 1.5% reduction.
In contrast, both fuel oil (27.7% vs. 41.5%) and electricity costs (11.9% vs. 14.4%) decreased. Despite indications that inflation may have peaked at 9.1% in June of last year, it remains more than three times above the Fed’s 2% objective and continues to indicate a broad-based increase in the general price level, notably for services and housing.
Compared to December, the CPI jumped 0.5%, the most in three months, mostly due to increases in the prices of housing, food, gasoline, and natural gas.
