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Overall consumer prices increased 0.5 percent in January after a 0.2 percent increase in December. NAFCU Vice President of Research and Chief Economist Curt Long said the higher-than-expected growth will likely boost the Federal Open Market Committee's (FOMC) argument for raising interest rates in March.

"The energy index was driven up by a rebound of gasoline prices, while costs of food away from home rose more than usual," Long said in a NAFCU Macro Data Flash report. "Excluding the volatile energy and food categories, core inflation posted its largest monthly gain since last January."

From a year ago, energy prices were up 5.9 percent and food prices were up 1.7 percent, its largest increase since June 2015.

Long added that January's growth was boosted by apparel prices, which rose sharply in January after declining for three consecutive months, as well as higher costs for used cars, vehicle insurance and medical care services. Despite higher fuel prices, airline fares fell for the third straight month.

"Inflation is expected to pick up this year in light of a tightening labor market and tax stimulus," Long said. "Overall, this report provides more ammunition for the Fed to raise rates next month."

For the 12-month period, the overall consumer price index (CPI) rose 2.1 percent, the same increase as December.

Data published Wednesday by the Bureau of Labor Statistics found that core prices (excluding food and energy costs) increased 0.3 percent in January compared with the previous month. Year-over-year core CPI growth remained at 1.8 percent.