Last Week: -0.29%
YTD: 5.09%
1 Year: 24.53%
Dow Jones Industrial Average
Last Week: -0.34%
YTD: 2.69%
1 Year: 16.41%
Last Week: -1.00%
YTD: 5.08%
1 Year: 35.63%
Last Week: -0.64%
YTD: 0.47%
1 Year: 5.98%
YTD: 7.46%
1 Year: 39.66%
YTD: 2.04%
1 Year: 9.06%
January Inflation
The inflation numbers from January increased more than expected. This comes after a low inflation report from December. The Consumer Price Index came in at 0.3%, slightly higher than the analysts’ expectations of 0.2%. Core CPI, which removes food and energy prices, came in at 0.4% for January, which is up 3.9% from a year ago. The forecasted expectations were 0.3% and 3.75%, respectively. An increase in shelter and food costs was the biggest factor in the hot inflation numbers. The January inflation report highlights the Fed may not be cutting rates any time soon, considering the sticky inflation we are still seeing. With the red-hot inflation report, we saw a sizable drop in the stock market, with the major indices declining more than 2% on the day the news was released.
Retail Sales
Early retail sales data shows a large decrease for January. The data reports a decline of 0.8%, down from a 0.4% gain in December. The largest decrease came from building materials and garden store sales sliding 4.1%, followed by miscellaneous sales falling 3%, and auto part sales falling 1.7%. The decline in consumer spending will help offset the higher inflation we saw in January. This could be another sign that consumers are becoming more budget-conscious as household balance sheets have seen a significant decrease in savings.
Wholesale Prices
Another major key indicator for inflation came in above expectations. Wholesale prices, which are measured by the Producer Price Index, came in at 0.3% for January. This was considerably higher than the 0.1% predicted by analysts. PPI was down 0.2% in December. The high PPI numbers came in days after hot CPI numbers, showing more signs of stubborn inflation. The markets did not react as harshly to the higher PPI numbers as they did to the CPI data. On a positive note, the 12-month increase in PPI of 0.9% was lower than the 1% December year-over-year increase.
