Consumer prices in the U.S. increased by more than anticipated in the month of January, according to a report released by the Labor Department on Wednesday.
The Labor Department said its consumer price index climbed by 0.5 percent in January after edging up by a revised 0.2 percent in December.
Economists had expected consumer prices to rise by 0.3 percent compared to the 0.1 percent uptick originally reported for the previous month.
The bigger than expected increase in consumer prices was partly due to a jump in energy prices, which surged up by 3.0 percent in January after dipping by 0.2 percent in December.
Excluding food and energy prices, core consumer prices rose by 0.3 percent in January after inching up by 0.2 percent in December. Core prices had been expected to increase by 0.2 percent.
Increases in prices for shelter, apparel, and medical care more than offset declines in prices for airline fares and new vehicles.
Compared to the same month a year ago, consumer prices were up by 2.1 percent in January, while core consumer prices were up by 1.8 percent.
“Overall we think the increase in core CPI inflation in January is a sign of things to come over the rest of the year,” said Michael Pearce, Senior U.S. Economist at Capital Economics.
He added, “Once temporary factors drop out of the annual comparison in the spring, core CPI inflation will be close to 2.5% and we expect it to trend higher from there.”
On Thursday, the Labor Department is scheduled to release a separate report on producer prices in the month of January.
Producer prices are expected to climb by 0.4 percent, while core producers prices are expected to rise by 0.2 percent.