US inflation rose to 3% in January, and the Federal Reserve stepped up its lawsuit to extend its suspension of interest rate cuts.
The consumer price index jumped higher than expected, with data from the Labor Bureau of Statistics Office shown Wednesday, up 0.5%, the fastest monthly increase since December to August 2023. Last month, the annual pace was 2.9%.
The “Core” CPI more closely reflects underlying inflation by removing the prices of volatile food and energy, but showed little improvement. It has risen 0.4% or 3.3% year-on-year since December, but both are higher than economists had expected. The monthly rise in core prices was the highest since April 2023.
January data highlighted the uneven nature of central bank battles against high prices. Inflation has subsided dramatically since just over 9% in 2022, but progress has been far more sporadic over the past few months.
Last month, price hikes in sectors that consumers have closely monitored, from groceries to gasoline, offsetting declines in other categories such as clothing and furniture.
Grocery prices rose 0.5% or 1.9% per year compared to the previous month. This has been driven primarily by a nationwide egg shortage caused by avian flu or avian flu outbreaks that have increased prices by 15.2% in the past four weeks. Egg prices have risen 53% since last year.
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