US Inflation Comes in Lower Than Expected

The annual inflation rate in the US slowed to 2.4% in January 2026, its lowest level since May, down from 2.7% in each of the previous two months and below forecasts of 2.5%. The deceleration largely reflects base effects, as higher readings from a year ago drop out of the annual calculation. Price pressures eased notably in the energy sector, with prices falling 0.1%, after a 2.3% rise in December, led by gasoline (-7.5% vs -3.4%) and fuel oil (-4.2% vs 7.4%). Prices of natural also rose at a slightly slower pace (9.8% vs 10.8%). A decline was also seen in prices for used cars and trucks (-2% vs 1.6%) while inflation slowed for food (3.1% vs 2.9%) and shelter (3% vs 3.2%). On a monthly basis, the CPI rose by 0.2%, below 0.3% in December and forecasts of 0.3%. Annual core inflation eased to 2.5%, its lowest reading since March 2021, compared with 2.6% in the prior month and in line with expectations. On a monthly basis, core CPI increased by 0.3%, slightly above 0.2% in December.

The annual inflation rate in the US likely slowed to 2.5% in January 2026, marking its lowest level since May, down from 2.7% in each of the previous two months. The deceleration largely reflects base effects, as higher readings from a year ago drop out of the annual calculation. On a monthly basis, the CPI is estimated to have risen by 0.3%, matching December’s increase. Food and electricity prices are expected to have moved higher, while gasoline prices likely declined. There are also indications that core goods prices may have firmed, as companies potentially used the start of the new calendar year to implement tariff-related price adjustments. Meanwhile, annual core inflation is projected to ease to 2.5%, its lowest reading since March 2021, compared with 2.6% in the prior month. On a monthly basis, core CPI is expected to have increased by 0.3%, slightly above December’s 0.2% rise.

The annual inflation rate in the US remained at 2.7% in December 2025, the same as in November and in line with market expectations. Price pressures eased notably in the energy sector, with prices rising at a much slower pace (2.3% vs. 4.2%), driven by a decline in gasoline prices (-3.4% vs. +0.9%) and a moderation in fuel oil inflation (7.4% vs. 11.3%), while natural gas prices rose more sharply (10.8% vs. 9.1%). Prices also increased at a slower rate for used cars and trucks (1.6% vs. 3.6%). By contrast, price gains accelerated for food (3.1% vs. 2.6%) and shelter (3.2% vs. 3.0%). Meanwhile, the annual core inflation rate remained unchanged at 2.6%, the lowest level since 2021, below expectations for a rise to 2.7%. On a monthly basis, the CPI edged up 0.3%, in line with forecasts, with shelter costs rising 0.4% and accounting for the largest contribution to the overall increase. The core rate came in at 0.2%, below forecasts of 0.3%.