• Mon. Feb 26th, 2024

Relief, But Not Yet: Inflation Slowdown Eases Pressure on Consumers in January

ByEditor

Feb 13, 2024
January US Consumer Inflation Moderated, but Fell Short of Expectations

Americans were relieved to see that price hikes eased off less than expected in January, but still provided a hint of relief for those who have experienced some of the steepest price increases in four decades. The Consumer Price Index, which measures the first measure of inflation for 2024, showed that prices rose by 3.1% for the 12 months ended in January, according to Bureau of Labor Statistics data released Tuesday. This marks a step back from December’s 3.4% rate and a dramatic cooling from the 6.4% increase seen in January 2023. On a monthly basis, CPI rose by 0.3%, with stubbornly high shelter costs accounting for two-thirds of the gain, according to the BLS.

Consumers got some relief from falling gas prices; however, food prices (which thankfully are no longer outpacing overall inflation) rose at their highest monthly rate in a year. While monthly food price changes are volatile and can be influenced by a variety of factors, including weather events and disease, they moved in the wrong direction for many Americans. “Food prices kept going up, and that’s a real pain point,” said Robert Frick, corporate economist with Navy Federal Credit Union. “There’s the rate of inflation, which is coming down, then there’s the weight of inflation, which continues to mount.” Economists were expecting inflation to ease to 0.2% from December and slow to 2.9% annually, according to FactSet consensus estimates.

Despite this progress, overall inflation has risen at an average rate of 3% or above for over three years – the longest streak since the late 1980s and early 1990s – with annual price increases surging post-pandemic peaking at an unprecedented level of 9.1 percent in June

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