Retail inflation remained in check in January. New government statistics showed a slight increase in consumer prices for the month, but the advance slowed down from the previous month and matched economists' expectations.
The U.S. Labor Department revealed that consumer prices advanced 0.1 percent in January. This followed an increase of 0.2 percent in the previous month.
Economists had expected the figure to rise 0.1 percent.
Core prices, which exclude the volatile food and energy sectors, also edged up by 0.1 percent. This matched the 0.1 percent rise seen in December.
Compared with last year, consumer prices were up 1.6 percent. Core prices were also 1.6 percent higher than in January 2013.
The consumer price index is an important measure of retail inflation. A tame reading indicates that the Federal Reserve can take its time in moderating its stimulative monetary policy. If inflation pressures were to show signs of increasing dramatically, the Fed might be forced to tighten its policy quickly in oder to clamp down on rising prices.
Energy prices advanced 0.6 percent in January. This marked a notable slowdown compared to the 1.6 percent growth seen in December. December's advance followed a period of moderation for energy prices, with the figure declining in 3 of the previous 4 months.
Gasoline prices slipped 0.5 percent in January, following a 2.6 percent jump in the previous month. Gas prices have declined in 5 of the past 6 months.
Food prices ticked up 0.1 percent after a flat performance in December.
The consumer price report followed a similarly tame wholesale inflation report from earlier in the week. On Wednesday, government data showed that producer prices ticked up in January, but matched expectations and remained well within a range that indicates that inflation pressures remain under control.
The U.S. Labor Department said producer prices advanced 0.2 percent in January compared to the previous month. This was a slightly faster pace than was seen in December, when the figure showed a 0.1 percent increase.
Also on Wednesday, the Federal Reserve released the minutes of its most recent policy meeting. The minutes showed that most Fed members are determined to taper the central bank's bond-buying program despite this winter's troubling economic data.
Tame inflation readings allow the Fed to set the pace of its tapering policy without worrying about a sharp rise in prices in the near term.
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December 12, 2025 15:14 ET Central bank decisions dominated the economic news flow this week led by the Federal Reserve. Trade data from the U.S. also gained attention. The Canadian and Swiss central banks also announced their interest rate decisions. Inflation data from China was in focus as the country released the latest consumer price and producer price data.