Pace of Inflation Slowed YOY to 2.4% in January

Washington, DC, February 13, 2026-The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.2% on a seasonally adjusted basis in January, the U.S. Bureau of Labor Statistics reported. Over the last 12 months, the all-items index increased 2.4% before seasonal adjustment.

The index for shelter rose 0.2% in January and was the largest factor in the all-items monthly increase. The food index increased 0.2% over the month as did the food at home index, while the food away from home index rose 0.1%. These increases were partially offset by the index for energy, which fell 1.5% in January.

The index for all items less food and energy rose 0.3% in January. Indexes that increased over the month include airline fares, personal care, recreation, medical care, and communication. The indexes for used cars and trucks, household furnishings and operations, and motor vehicle insurance were among the major indexes that decreased in January.

The all-items index rose 2.4% for the 12 months ending January, after rising 2.7% for the 12 months ending December. The all items less food and energy index rose 2.5% over the last 12 months. The energy index decreased 0.1% for the 12 months ending January. The food index increased 2.9% over the last year.

Said the Wall Street Journal, “The latest annual number had some help, since a high inflation reading from January 2025 has now dropped out of the past 12 months of data. Month over month from December, consumer prices in January rose a seasonally adjusted 0.2% and core prices rose 0.3%.

“The January inflation release comes two days after a report of better-than-expected jobs growth last month and a decrease in the unemployment rate to 4.3%.

“Despite the good news, the Federal Reserve has a delicate task ahead in the final months of Jerome Powell’s eight-year tenure as chair. The central bank aims to keep inflation at a 2% annual pace, but has missed that target for about five years. Fed officials are still trying to strike a careful balance: leaning against inflation without bruising the labor market.

“Aggressive interest-rate hikes punctured the blistering price increases that slammed the economy in 2022. But as inflation receded and the job market cooled, the Fed shifted gears, voting through nearly two percentage points of rate cuts since the summer of 2024 before pausing in January.”