The Consumer Price Index (CPI) rose .2% in January from December, falling just below expectations. However, the Core CPI (as shown in this chart) also increased .2%, which was just above expectations.
The Consumer Price Index (CPI) is a measure of the average price level paid by urban consumers (80% of population) for a fixed basket of goods and services. Core CPI removes the volatile food and energy categories and is considered a better gauge on inflation trends.
Year-over-year, Core CPI is up 2.3%, the largest yearly gain since September 2008. It's important to keep an eye on CPI readings as it's an indication of inflation being passed down from the producer to the consumer meaning higher costs on goods and services.
