NYREADERS.COM – The U.S. year-on-year (yoy) inflation rate fell to 3.1% in January 2024, compared to the same month last year, the lowest since June last year, the U.S. Bureau of Labor Statistics reported on Tuesday.
The inflation rate was lower compared to 3.35% in December 2023 and 6.41% in January 2023.
“Over the last 12 months, the all items index increased 3.1 percent before seasonal adjustment,” the statistic bureau said. The index for shelter continued to rise in January, increasing 0.6 percent and contributing over two-thirds of the monthly items increase.
The food index increased 0.4 percent in January, as the food at home index increased 0.4 percent and the food away from home index rose 0.5 percent over the month. In contrast, the energy index fell 0.9 percent over the month due in large part to the decline in the gasoline index. The index for all items less food and energy rose 0.4 percent in January.
Indexes that increased in January include shelter, motor vehicle insurance, and medical care. The index for used cars and trucks and the index for apparel were among those that decreased over the month. The all-items index rose 3.1 percent for the 12 months ending January, a smaller increase than the 3.4 percent increase for the 12 months ending December.
All items less food and energy index rose 3.9 percent over the last 12 months, the same increase as for the 12 months ending December. The energy index decreased 4.6 percent for the 12 months ending January, while the food index increased 2.6 percent over the last year.
Since 2012, the Federal Reserve has targeted a 2% inflation rate for the US economy and may make changes to monetary policy if inflation is not within that range. The stubborn inflation data complicates the Fed's fight against inflation, and could push back the timetable for potential rate cuts, analysts say.
The central bank is attempting a balancing act with its key interest rate, which influences borrowing costs on all kinds of loans. High rates slow the economy and push down inflation by discouraging borrowing and spending, but risk causing a recession. (*)
