The latest inflation data came in hotter than expected.
Data released in yesterday’s Consumer Price Index (CPI) showed the annual rate of inflation dropped less than expected to 3.1% in January from 3.4% in December. Economists were expecting price growth to come in at 2.9%.
Core CPI, which excludes the more volatile energy and food prices and is generally considered a better gauge of underlying trends, rose by 3.9%, the same pace seen in the month prior and also above economists’ expectations.
Shelter prices, which comprise about one-third of the CPI weighting, accounted for much of the rise. The index for that category climbed 0.6% last month, contributing to more than two-thirds of the headline increase, according to the US Bureau of Labor Statistics.
Food prices moved higher as well, up 0.4% on the month. Energy helped offset some of the increase, down 0.9% due largely to a 3.3% slide in gasoline prices.
Federal Reserve officials have warned that bringing inflation down to the central bank’s 2% target will be a challenge, and yesterday’s data underscores that point.
Stock market futures fell sharply following the release of the data yesterday. The Dow and the S&P 500 both fell 1.4%. The Nasdaq Composite dropped 1.8%.
Get instructions on how to enable our Flash News Briefing skill to your Amazon devices:
Bautis Financial LLC is a registered investment advisor. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial advisor and/or tax professional before implementing any strategy discussed herein. Past performance is not indicative of future performance.
Market Recap Week of 02/05/2024 Through 02/09/2024