Analysis: Stabilizing the labor force may keep the Federal Reserve on hold

BlockBeats News, February 13 — The U.S. Bureau of Labor Statistics announced on Friday that the January CPI increased by 0.2% month-over-month, slightly below December’s 0.3% increase and also below economists’ expectations of 0.3%. Excluding volatile food and energy prices, the core CPI rose by 0.3% month-over-month, slightly higher than December’s 0.2% increase.

In year-over-year terms, the CPI rose by 2.4%, slowing from December’s 2.7%, mainly due to the high base effect from last year; the core CPI increased by 2.5% year-over-year, down from December’s 2.6%.

The January report for the first time incorporated an update to the seasonal adjustment factor reflecting price changes in 2025. Economists note that January’s core CPI data often exceeds expectations because the Labor Department’s model does not fully account for one-time price increases at the beginning of the year.

This month’s increase may reflect both this year-start effect and the transmission impact of broad tariffs imposed by Trump. Despite the slowdown in inflation, a stable labor market could lead the Federal Reserve to keep interest rates unchanged for a period. Economists expect that, due to the transmission of import tariffs and last year’s dollar depreciation, inflation may experience a phased rebound within the year. (Jin10)

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