United States: Inflation Dips Slightly Even as Gas Prices Tick Up

The US consumer price index (CPI) increased 0.5% in January after edging up 0.1% in December (revised from -0.1%). Core CPI, which strips out food and energy, rose 0.4% in January, a repeat of December.  The 12-month change in the all items index continued to decline, from 6.5% to 6.4%. The 12-month change in the all items less food and energy index also slowed, from 5.7% to 5.6%. Although inflation was down again in January, it’s falling at a slower rate than in recent months. We’re also seeing some stickiness in non-food and energy prices, mostly coming from the services side. Combined with a staggeringly strong labour market, inflation remains enough of a concern for the Fed to keep notching up interest rates.