- January’s inflation rate was 2.4%, a cooler rate than the 2.5% forecast and the previous 2.7%.
- The report was slightly delayed due to the partial government shutdown.
- The new report follows the jobs report that showed a strong January after a difficult year.
Americans’ wallets are ringing in the new year with a little relief from rising prices. The US started 2026 with a slower inflation rate than at the end of 2025.
The consumer price index, an inflation measure, increased 2.4% in January from a year ago, below the 2.7% increase in both November and December. Economists expected a year-over-year increase of just 2.5%.
We also got new data on the job market’s performance this week. The Bureau of Labor Statistics released its rescheduled jobs report on Wednesday, due to the partial government shutdown, which showed the US added fewer jobs in 2025 than previously reported but better job growth this past January than expected. Unemployment fell in January from December as labor force participation ticked up.
“The 181,000 jobs that were added across 2025 really starkly show how challenging the labor market was and how little movement on either side there really has been as both employers and workers were stuck in place and clinging to stability,” Nicole Bachaud, an economist at ZipRecruiter, told Business Insider.
Federal Open Market Committee members held interest rates steady in their first decision of the year in January. They can use the new reports to determine what to do next with interest rates. CME FedWatch showed a 90% chance before the new consumer price index report that the Fed would hold rates steady, but more data will be available to understand the economy before they meet in March.
This is a developing story. Please check back for updates.
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