U.S. consumer prices continued to rise in January as energy and food prices increased, but underlying inflation remained tame as many companies struggled to pass on higher raw materials costs to consumers.
Separately, the number of U.S. workers filing new claims for unemployment benefits rose more than expected last week as the labor market remains sluggish despite the economy's improvement.
The seasonally adjusted consumer price index last month increased by 0.4% from December, the Labor Department said Thursday. Over the last 12 months, prices were up 1.6% before seasonal adjustments.
But underlying inflation, which excludes volatile energy and food prices and is considered a better measure of price trends by the Federal Reserve, rose by 0.2%. The annual underlying inflation rate stood at 1.0% last month, below the Fed's informal target of just under 2.0%.
Economists surveyed by Dow Jones Newswires ahead of the release expected consumer prices to rise by 0.3% and the core consumer price index to gain 0.1%. In December, consumer price inflation showed a 0.4% monthly rise, revised from a previously reported 0.5% gain.
Related Article
•Philly-Area Factories Post White-Hot Gain
•Outlook for Food Prices: High
While wholesale prices rose across the board in January on higher raw material costs, firms are struggling to pass this on to consumers due to persistently high unemployment, which is keeping Americans cautious about spending. Retail sales rose modestly last month, following strong gains during the holiday season.
At their last meeting three weeks ago, Fed officials upgraded their outlook for economic growth. But they still expect slow price increases over the next two years and unemployment to remain close to 9.0% until the end of 2011. For these reasons, they stuck to their easy-money policies, including purchases of $600 billion in Treasury's that are slated to run until June.
Thursday's report showed that higher prices for energy commodities and food accounted for more than two-thirds of the rise in consumer prices. Food prices rose 0.5% in January, the biggest increase since September 2008, with all six major grocery store food groups showing gains.
Energy prices continued their recent string of increases, rising by 2.1% last month as the gasoline index went up for the seventh month in a row.
Other categories showed more subdued price increases and even some declines. Prices for shelter rose 0.1% last month, while the price of new vehicles fell by 0.1%. The price of medical services was down 0.1%, the biggest decline since 1975.
Without rounding, the report showed that consumer prices rose by 0.398% in January from December. Excluding food and energy items, consumer prices increased 0.170%.
In the meantime, real average weekly earnings fell 0.3% over the month in January as both the average workweek and hourly earnings dropped, the Labor Department said.
Jobless Claims Back Over 400,000
Initial jobless claims increased by 25,000 to 410,000 in the week ended Feb. 12, the Labor Department said Thursday in its weekly report.
Page 1Page 2
Continued from page 1
Page 1Page 2
Economists surveyed by Dow Jones Newswires had expected claims would rise last week by 17,000 to 400,000.
New claims had fallen sharply over the previous two weeks as employment rebounded from severe winter storms. Now, the jobs market appears to have stabilized near January's levels.
The four-week moving average of new claims, considered a more reliable indicator because it smooths out volatile data, increased 1,750 to 417,750 in the week ending Feb. 12. Jobless claims have been on a gradually downward trend since September 2010.
The U.S. labor market has been slowly improving as the recovery gains momentum. Non-farm payrolls rose by a mere 36,000 jobs in January, but the disappointingly small increase was blamed on snowstorms. The data showed the U.S. jobless rate tumbled to its lowest level since April 2009.
The U.S. economy has been picking up speed in recent months, and the Federal Reserve expects it to grow at a stronger pace this year, lifted by consumer and business spending.
Recent indicators have been mixed as the country shakes off the effect of storms that shut down parts of the country. But the latest batch of data on Wednesday showed surprising gains for the battered housing sector, while U.S. manufacturers continued to increase production.
Still, Fed officials estimate that it will probably take at least four years for unemployment to fall to between 5% and 6% from January's 9.0% rate.
The Labor Department said in Thursday's report that the number of continuing claims--those drawn by workers for more than a week--climbed 1,000 to 3,911,000 in the week ended Feb. 5. Continuing claims are reported with a one-week lag.
The unemployment rate for workers with unemployment insurance was 3.1% in the week ending Feb. 5, unchanged from the prior week.
The state-by-state breakdown of new claims, which is also reported with a one-week lag, showed North Carolina and Michigan with the biggest increases in claims.
States with the largest declines were led by Florida, as it reported fewer layoffs in construction, trade, service and manufacturing industries.
The Labor Department estimated figures for Alaska and Puerto Rico during the Feb. 12 week.
Leading Indicator Inch Up
The index of leading economic indicators barely increased in January but the small rise followed two much larger gains, according to data released Thursday.
The leading index increased 0.1% last month, after a revised 0.8% gain in December, first reported as 1.0%, the Conference Board said. The index advanced 1.1% in November.
Economists surveyed by Dow Jones Newswires had expected a gain of 0.3% in the January index.
"The economy gained some momentum in late fall, and the latest data suggest that trend will continue," says Ken Goldstein, economist at the board.
In January, six of the 10 leading indicators increased. The most positive indicators were interest rate spread and supplier deliveries.
The coincident index was up 0.1% in January on top of a revised 0.3% gain in December, originally reported as 0.2%.
The lagging index fell 0.1% after rising a revised 0.2%, first reported as a gain of 0.3%.
Kathleen Madigan contributed to this article.
AND STILL, OUR SOCIAL SECURITY CHECKS ARE FROZEN.
I am real HOT on our Social Security and COLA isues on Facebook and my WEBSITE.
That is why you have not seen me over here much.
OLY
I am not sure that my reply will comfort you. The truth is what you describe to be happening in the United States of America. The huge rise in the cost of living. Well this is happening in every part of the world. I am based in the United Kingdom at the moment. Just buying food and paying my power (electricity)bill is absorbing all my weekly income. There is very little money left for anything else. I have only bought 4 new items of clothing over the part 25 months. And these I bought because they were priced at 3 dollar per item.
Just to give you an idea of the soaring coat of living here. I litre of petrol $2.50. 30 Eggs budget eggs not free range cost $6 dollars. Cost of housing minimum $145 dollar per week.
I have no idea how to fix this global economic trap that we have fallen into. It may sound futile but I am doing regular prayers in the hope that the lord almighty will change something or that some major break from the plight will manifest for people in America, for people in the United Kingdom and for people all over the world. Thank you for your post it allows me to know that I am not alone in believeing that this hike in prices and drop in income has got to stop.
by Sharlee 4 years ago
The elite on wall street to include investment banks have smashed earning expectations today. While American worker struggles with rising consumer good prices due to President Joe Biden’s inflation.JPMorgan Chase --- “second-quarter earnings of $11.9 billion, or $3.78 per share,...
by Scott Belford 6 months ago
This is, of course, an open question since he has just started his four years, but since the RINO Party is already saying defeating Covid and growing the economy is a disaster, I thought I would start a thread that proves them wrong.I just listed two things he has done:- Got America well on its way...
by Willowarbor 7 months ago
Trump will inherit "the strongest economy in modern history," "an economy primed for growth," "booming markets and solid growth," an economy that is "pretty damn good," and investments "flowing" to "rural and manufacturing communities."In...
by Sharlee 3 years ago
"Drivers have been fuming about high gas prices since last fall, and inflation has had Americans up in arms for almost a year now. But neither annoyance prepared people for the recent unpleasant shock of getting the winter's first gas and electric bills.Soaring heating bills shouldn't come as...
by lady_love158 14 years ago
http://apnews.myway.com/article/20110303/D9LNNCN01.htmlI've posted about this before but here it is espoused by the UN. You might ask why is there inflation? Economies are recovering slowly, unemployment remains high, incomes are stagnant, and interest rates are low... so what is driving...
by Beth Perry 11 years ago
Have increased food prices changed your daily meal planning, and if so how?
Copyright © 2025 The Arena Media Brands, LLC and respective content providers on this website. HubPages® is a registered trademark of The Arena Platform, Inc. Other product and company names shown may be trademarks of their respective owners. The Arena Media Brands, LLC and respective content providers to this website may receive compensation for some links to products and services on this website.
Copyright © 2025 Maven Media Brands, LLC and respective owners.
As a user in the EEA, your approval is needed on a few things. To provide a better website experience, hubpages.com uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.
For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at: https://corp.maven.io/privacy-policy
Show DetailsNecessary | |
---|---|
HubPages Device ID | This is used to identify particular browsers or devices when the access the service, and is used for security reasons. |
Login | This is necessary to sign in to the HubPages Service. |
Google Recaptcha | This is used to prevent bots and spam. (Privacy Policy) |
Akismet | This is used to detect comment spam. (Privacy Policy) |
HubPages Google Analytics | This is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy) |
HubPages Traffic Pixel | This is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized. |
Amazon Web Services | This is a cloud services platform that we used to host our service. (Privacy Policy) |
Cloudflare | This is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy) |
Google Hosted Libraries | Javascript software libraries such as jQuery are loaded at endpoints on the googleapis.com or gstatic.com domains, for performance and efficiency reasons. (Privacy Policy) |
Features | |
---|---|
Google Custom Search | This is feature allows you to search the site. (Privacy Policy) |
Google Maps | Some articles have Google Maps embedded in them. (Privacy Policy) |
Google Charts | This is used to display charts and graphs on articles and the author center. (Privacy Policy) |
Google AdSense Host API | This service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy) |
Google YouTube | Some articles have YouTube videos embedded in them. (Privacy Policy) |
Vimeo | Some articles have Vimeo videos embedded in them. (Privacy Policy) |
Paypal | This is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy) |
Facebook Login | You can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy) |
Maven | This supports the Maven widget and search functionality. (Privacy Policy) |
Marketing | |
---|---|
Google AdSense | This is an ad network. (Privacy Policy) |
Google DoubleClick | Google provides ad serving technology and runs an ad network. (Privacy Policy) |
Index Exchange | This is an ad network. (Privacy Policy) |
Sovrn | This is an ad network. (Privacy Policy) |
Facebook Ads | This is an ad network. (Privacy Policy) |
Amazon Unified Ad Marketplace | This is an ad network. (Privacy Policy) |
AppNexus | This is an ad network. (Privacy Policy) |
Openx | This is an ad network. (Privacy Policy) |
Rubicon Project | This is an ad network. (Privacy Policy) |
TripleLift | This is an ad network. (Privacy Policy) |
Say Media | We partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy) |
Remarketing Pixels | We may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites. |
Conversion Tracking Pixels | We may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service. |
Statistics | |
---|---|
Author Google Analytics | This is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy) |
Comscore | ComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy) |
Amazon Tracking Pixel | Some articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy) |
Clicksco | This is a data management platform studying reader behavior (Privacy Policy) |