US Core CPI Rises in January on Firmer Services Costs

• US Jan. Consumer Prices (CPI) rose 2.4% Y/Y, below the 2.5% estimate, and 0.2% M/M, below the 0.3% estimate.
• US Jan. Core CPI rose 2.5% Y/Y and 0.3% M/M, both in line with estimates.
• Gasoline prices were down 3.2% M/M, and used car prices fell 1.8% M/M, contributing to the softer headline CPI.
• Treasury yields fell across the curve, and S&P, Nasdaq, and Russell 2000 futures rose following the data release.

The January US CPI report showed headline inflation rising 2.4% year-over-year, which was slightly less than the 2.5% estimate, while core CPI rose 2.5% year-over-year, meeting expectations. This softer-than-anticipated headline figure, driven by declines in gasoline and used car prices, led to a positive market reaction with rising equity futures and falling Treasury yields.