February 20, 2014

Consumer prices increased in January

Feb. 21, 2014 – Overall consumer prices increased a seasonally adjusted 0.1 percent in January, primarily due to rising household energy costs, according to NAFCU Research Assistant Doug Christman.

For the 12-month period, overall consumer price index growth was 1.6 percent, up from 1.5 percent in December.

Analyzing data published by the Bureau of Labor Statistics for a NAFCU Macro Data Flash report, Christman said core CPI, which excludes food and energy costs, fell slightly to 1.6 percent year over year but remained relatively unchanged over the previous nine months.

Energy prices increased by 0.6 percent in January following a 1.6 percent increase in December. From a year ago, energy prices were up 2.1 percent. Food prices increased 0.1 percent in January following an increase of 0.1 percent in December; they rose 1.1 percent on a year-over-year basis.

"Both CPI and core CPI remain well below the Fed's stated inflation target," Christman said. "The Fed has a dual mandate to foster maximum employment and price stability when making policy decisions. Their stated thresholds are an unemployment rate below 6.5 percent and long-run inflation rate no higher than 2.5 percent."