WASHINGTON—The latest inflation report will likely slow the pace of further interest rate cuts by the Federal Reserve.
The Consumer Price Index accelerated at a seasonally adjusted 0.5% in January, putting the annual inflation rate at 3%, the Bureau of Labor Statistics reported.
“Inflation in January rose faster than expected, driven by broad increases in services, commodities, and groceries,” said Dawit Kebede, America's Credit Unions senior economist. “Core inflation, a strong predictor of future headline prices, remained stuck between 3.2 % and 3.3% for the last seven months, indicating that reaching the target remain difficult. This report, combined with a still-solid labor market, supports the case for the Federal Reserve to maintain interest rates.”