Inflation rises 3% in January, hotter than expected
Published On Feb 12, 2025, 8:32 AM
Inflation in the U.S. rose by 3% in January, coming in higher than economists' predictions of a 2.9% increase. This monthly figure was up 0.5% from December. Core inflation, which excludes food and energy prices, also rose more than expected, indicating persistent inflationary pressures. The increase is attributed to higher costs in various sectors such as housing, energy, and food, causing continued financial strain on households. The Federal Reserve is likely to maintain its interest rates in response to this inflation data, affecting future monetary policy decisions.
Stock Forecasts
TIP
Positive
The unexpected rise in inflation may lead the Fed to maintain or even increase interest rates. This could adversely affect sectors sensitive to interest rates, such as housing and consumer discretionary industries. However, inflationary pressure may benefit commodities and inflation-protected securities.
XLP
Positive
Financial services may see volatility as investors react to potential interest rate changes reflecting inflation. Stocks in sectors like consumer staples might perform better as consumers lean towards essential goods.
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