Despite the monthly increase of 0.5%, annual inflation continued to slow for the seventh consecutive month to 6.4% in January 2023, as per the Bureau of Labor Statistics. The core CPI index increased 0.4% from December but moderated annually to 5.6%.
Moreover, shelter costs largely pushed up monthly prices, accounting for nearly half of the increase. Erik Lundh, the principal economist at the Conference Board, said that the shelter component of CPI typically lags market conditions by 12 months. Home prices and rents have cooled during the past year, so the CPI is expected to reflect that soon.
