BUCKLE UP, JANUARY CPI PRINT IS IN

The U.S. Bureau of Labor Statistics posted the January CPI on Thursday morning, and surprise surprise it was absolutely heinous. January CPI grew 0.6% from the month prior, and jumped 7.5% compared to January 2021. According to the BLS, this is the single largest 12-month increase since February 1982. Can someone get Paul Volcker back in the Fed to help us out?

Used cars and fuel oil accounted for a bulk of the massive print, both up 40.5% and 46.5% from 2021, respectively. Although purely anecdotal, I’ve heard from friends using fuel oil that their bills to get their tanks filled has been just absolutely abysmal.

I won’t even get into the food portion of the CPI, as it’s arguably not even worth mentioning because of good old “substitution” (we’ll talk about that at a later time).

Interestingly enough, lodging away from home was one of the few categories that saw a decrease at -3.9% in the month of January, along with wireless telephone services at -0.9%.

Although we didn’t hit the old triple double with double digit inflation in 2021, hotter than expected inflation likely won’t bode well for economic growth in the future, setting up the Fed for more aggressive rate hikes, coupled with an ostensible decrease in consumer spending.