Year-Over-Year Inflation Remains Higher Than Expected Hitting 6.4% In January

Inflation remains a real challenge for the Biden administration as the increase in the cost of living continues to strain American households.

🚨 BREAKING: January CPI is 6.4%, which is higher than expected and up 0.5% month-over-month.

Prices are still going up, thanks to Biden's reckless spending. pic.twitter.com/xNFFAw5v32

— Media Research Center (@theMRC) February 14, 2023

The leftist media refuse to blame Biden for ongoing inflation. https://t.co/CsWModNzWW

— Media Research Center (@theMRC) February 14, 2023

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While the month-over-month inflation rate had slowed and there had been a bit of a reprieve at the end of 2022, it is now increasing again. The CPI rose in January after a bit of a decline at the end of last year.

The Labor Department reported that the CPI, a broad measure of the price of everyday goods that includes gasoline, groceries and rents, rose 0.5% on the month in January after a surprise decline of 0.1% in December.

Annually prices remain above 6% but are down sharply from the 9.1% surge in June, which marked the highest inflation rate in almost 41 years…

…When factoring out volatile food and energy costs, the core consumer price index rose 0.4% in January, slightly above December’s 0.3% increase. Annually, core CPI ticked up 5.6% in January, more than expected.
Source: Fox Business

Households are noticing the increased costs — especially with food — and many are struggling to make ends meet.

While the January inflation rate is lower than the peak over the summer, 6.4% is still a pretty far cry from the target year-over-year inflation rate of just 2%.

“While there were no major surprises in today’s CPI reading, it is a reminder that while inflation has peaked it could be a while before we see it moderate to normal levels,” said Mike Loewengart, head of model portfolio construction at Morgan Stanley Global Investment Office.

“The question remains if inflation will be able to fall to the Fed’s target levels with the labor market as tight as it currently is,” he added. “That could be the recipe for a soft landing, but it remains to be seen when the Fed will shift away from rate hikes and if the labor market will lose its resiliency.”
Source: The Street

Sources:

1. U.S. Bureau of Labor Statistics. “CPI for all items rises 0.5% in January as shelter increases.” February 14, 2023. https://www.bls.gov/news.release/cpi.nr0.htm

2. Dumas, Breck. “Inflation rose 6.4% in January.” Fox Business. February 14, 2023. https://www.foxbusiness.com/economy/consumer-prices-inflation-rose-january

3. Baccardax, Martin. “Inflation Sticks at 6.4% In January, With Core Prices Quickening, Complicating Fed Battle.” The Street. February 14, 2023. https://www.thestreet.com/markets/inflation-sticks-at-6-4-in-january-with-core-prices-quickening