Monthly inflation in the U.S. stayed steady in January, but year-over year, the print accelerated to 7.5%, a four-decade high. Strong consumer demand and pandemic-related supply constraints have continued to push prices upwards.
Across the board, costs were up sharply for a number of everyday household items, including electricity, food, shelter and vehicles. A large portion of the increase was also due to the continued surge in housing rental prices, a major monthly household cost.
The consumer-price index measures what consumers pay for goods and services and is considered a common measure of inflation. Over the past eight months, inflation has been above 5% as a U.S. rebound from earlier in the COVID-19 pandemic created imbalances in the economy.
Meanwhile, the core price index saw a sharper increase than December, and marked the highest rate in nearly 40 years. The core price index excludes the often-volatile categories of food and energy, rose 6% in January. Food prices continued their ascent, rising at their biggest rate since the early 1980s.
Continued high inflation will remain a primary factor as the U.S. Federal Reserve determines the pace of rate increases.
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