Businesses looking for a single pricing signal in January’s inflation data would miss a pronounced split. The Bureau of Economic Analysis reported on February 29, 2024 that service prices were 3.9 percent higher than a year earlier, while goods prices were 0.5 percent lower. Overall PCE inflation was 2.4 percent over that period. [12]
The monthly figures told a shorter-term story. The PCE price index rose 0.3 percent from December, or 0.4 percent excluding food and energy. On that monthly basis, service prices rose 0.6 percent and goods prices fell 0.2 percent. The annual increase excluding food and energy was 2.8 percent; it should not be confused with the monthly core reading. [12]
An earlier BLS release, published February 13, put January’s annual CPI-U increase at 3.1 percent before seasonal adjustment. Its monthly increase was 0.3 percent after adjustment, with shelter contributing more than two-thirds of that rise. CPI and PCE are distinct named measures; agreement that overall prices rose does not make their annual rates interchangeable. [28][12]
Our business reading is to examine the relevant category before treating national inflation as a reason to change a price. Neither release provides a company-specific verdict. This retrospective reports the figures available in those February releases, including the BEA estimates now marked superseded, rather than presenting them as current readings. [12][28]
Source documents
- Personal Income and Outlays, January 2024 | U.S. Bureau of Economic Analysis (BEA)https://www.bea.gov/news/2024/personal-income-and-outlays-january-2024
- Consumer Price Index News Release - 2024 M01 Resultshttps://www.bls.gov/news.release/archives/cpi_02132024.htm