U.S. inflation accelerated to a 7.5% annual rate in January, reaching a new four-decade high as strong consumer demand and pandemic-related supply constraints kept pushing up prices.
The Labor Department on Thursday said the consumer-price index—which measures what consumers pay for goods and services—was last month at its highest level since February 1982, when compared with January a year ago, and higher than December’s 7% annual rate. Inflation has been above 5% for the past eight months.
The so-called core price index, which excludes the often-volatile categories of food and energy, climbed 6% in January from a year earlier. That was a sharper rise than December’s 5.5% rise, and the highest rate in nearly 40 years.
On a monthly basis, the CPI increased a seasonally adjusted 0.6% last month, holding steady at the same pace as in December.
Used-car prices continued to drive overall inflation, rising 40.5% in January from a year ago. A sharp uptick in housing rental prices also contributed to last month’s increase.
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