CPI rose 2.4% in January, lower than 2.5% expected. Back down to May 2025 level, and give Fed more confidence to lower interest rate.

* January's inflation rate was 2.4%, cooler than the 2.5% expected. This follows the 2.7% on December 2025. * "In January, the Consumer Price Index for All Urban Consumers rose 0.2 percent, seasonally adjusted, and rose 2.4 percent over the last 12 months, not seasonally adjusted. The index for all items less food and energy increased 0.3 percent in January (SA); up 2.5 percent over the year (NSA)." * This would bring it back to its May 2025 level, the month after enactment of “liberation day” tariffs that many thought would send prices spiraling higher. * It would give the Fed more room to lower interest rates without the high risk of another inflation burst. "The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.2 percent on a seasonally adjusted basis in January, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 2.4 percent before seasonal adjustment.  The index for shelter rose 0.2 percent in January and was the largest factor in the all items monthly increase. The food index increased 0.2 percent over the month as did the food at home index, while the food away from home index rose 0.1 percent. These increases were partially offset by the index for energy, which fell 1.5 percent in January.  The index for all items less food and energy rose 0.3 percent in January. Indexes that increased over the month include airline fares, personal care, recreation, medical care, and communication. The indexes for used cars and trucks, household furnishings and operations, and motor vehicle insurance were among the major indexes that decreased in January.  The all items index rose 2.4 percent for the 12 months ending January, after rising 2.7 percent for the 12 months ending December. The all items less food and energy index rose 2.5 percent over the last 12 months. The energy index decreased 0.1 percent for the 12 months ending January. The food index increased 2.9 percent over the last year." [https://www.bls.gov/cpi/](https://www.bls.gov/cpi/) [https://www.bls.gov/news.release/cpi.nr0.htm#](https://www.bls.gov/news.release/cpi.nr0.htm#)