According to the latest Consumer Price Index data, inflation soared in January by the most in three months. Consumer prices increased 6.4% over the year and 0.5% month-over-month, exceeding economists’ estimates of 6.2% and 0.5%, respectively.
Furthermore, the labor market is looking resilient, with strong job growth and a decades-low unemployment rate. The January jobs report showed that employers added a robust 517,000 jobs, significantly exceeding the 187,000 market estimate. The unemployment rate fell to 3.5%. Sticky inflation and a strong labor market have raised the prospect of aggressive rate hikes for longer.
