US inflation dropped to 2.4% in January after last year’s tariff-driven price swings. Prices rose 0.2% from December, according to the consumer price index. Core inflation, which excludes food and energy, increased 0.3% for the month. Economists had expected a slight decline to about 2.5% annually.
Inflation fluctuated throughout last year, hitting 2.3% in April before rising to 3% in September. It later fell to 2.7% by November and December. The White House credited Trump’s policies and dismissed concerns about lasting tariff impacts.
Investors now watch the Federal Reserve for signals on interest rates. The Fed paused rate cuts in January and will meet again in March. Chair Jerome Powell said tariffs may cause temporary price increases before stabilizing.
The labor market showed resilience in January, though overall job growth slowed compared with 2024. Meanwhile, recent polls show declining approval of Trump’s economic leadership, especially on inflation.
