Economy Watch: Inflation, Leading Indicators Tick Up in January

A January increase in the consumer price index and leading economic indicators signal a still-positive outlook for the U.S. economy.
Source: U.S. Bureau of Labor Statistics
Source: U.S. Bureau of Labor Statistics

The Consumer Price Index increased 0.6 percent in January, the Bureau of Labor Statistics reported last week. Over the last 12 months, the all items index rose 2.5 percent before seasonal adjustment.

The January increase was the largest monthly all items increase since February 2013. A sharp rise in the price of gasoline accounted for nearly half the increase, but advances in the prices for shelter, apparel and new vehicles were also major contributors.

Also last week, the Conference Board reported that its Leading Economic Index for the U.S. increased 0.6 percent in January to 125.5 (2010 = 100), following a 0.5 percent increase in December, and a 0.2 percent increase in November.

“The U.S. Leading Economic Index increased sharply again in January, pointing to a positive economic outlook in the first half of this year,” said Ataman Ozyildirim, director of business cycles and growth research at The Conference Board. He added that the January gain was broad based among the leading indicators. If the trend continues, the U.S. economy may even accelerate in the near term.