The annual inflation rate in the US slowed to 2.4% in January 2026, its lowest level since May, down from 2.7% in each of the previous two months and below the 2.5% consensus forecast. The moderation is largely due to base effects, as higher readings from a year earlier dropped out of the annual comparison.
Price pressures eased notably in the energy sector, where overall prices fell 0.1% after a 2.3% increase in December. This shift was driven by sharper declines in gasoline prices (-7.5% vs -3.4%) and fuel oil (-4.2% vs 7.4%). Natural gas prices continued to rise but at a slightly slower annual pace (9.8% vs 10.8%).
Deflation was also recorded in used cars and trucks, with prices down 2% after a 1.6% increase in the prior period. Meanwhile, inflation in food (3.1% vs 2.9%) and shelter (3% vs 3.2%) remained elevated, though shelter costs showed a modest slowdown.
On a monthly basis, the headline CPI rose 0.2%, easing from 0.3% in December and coming in below expectations of 0.3%. Annual core inflation fell to 2.5%, its lowest level since March 2021, down from 2.6% in the previous month and in line with forecasts. Month over month, core CPI increased 0.3%, a slight acceleration from 0.2% in December.
