US inflation fell to 2.4% in January after last year’s tariff-driven price swings. Prices rose 0.2% from December, according to federal data. Core inflation, excluding food and energy, increased 0.3%. Economists had expected a slight easing to 2.5%.
Inflation fluctuated throughout last year, hitting 2.3% in April before rising to 3% in September. It declined to 2.7% by November and December. The White House said the new figures prove its policies are reducing inflation.
Investors now watch the Federal Reserve for signals on interest rates. The Fed paused rate cuts in January and will meet again in March. Chair Jerome Powell said tariffs still affect prices but expects only temporary increases.
The labor market remained stable in January, though overall job growth slowed. The economy added 181,000 jobs in 2025 after revisions, compared with two million in 2024.
Recent polls show declining approval of Trump’s economic leadership, especially on inflation. The administration has proposed measures targeting housing costs, credit card debt, and drug prices to address affordability concerns.
