The U.S. Bureau of Labor Statistics reported that the Consumer Price Index for All Urban Consumers, which measures U.S. inflation, increased 0.6 percent in January. The all items index increased 7.5 percent before seasonal adjustment, the largest 12-month increase since the period ending February 1982.
This increase in U.S. inflation is above the 7.2 percent economists predicted in a Bloomberg survey but still slower than the fastest monthly increases in 2021. Forecasters predict that inflation will come down in 2022, finishing the year at closer to 3 percent.
The food index increased 0.9 percent after increasing 0.5 percent in December. The energy index was also up 0.9 percent.
While U.S. inflation jumped, retail sales also saw an increase in January. According to the Mastercard SpendingPulse, which measures in-store and online retail sales across all forms of payment, retail sales in January increased 7.2 percent year-over-year, and online sales were up 10.4 percent.
“Coming on the heels of the holidays, January typically marks a month of returns and exchanges. However, the strong growth across sectors reflects the optimism and eagerness for the year ahead,” says Steve Sadove, senior advisor for Mastercard and former CEO and chairman of Saks Incorporated. “With nearly all sectors up, we see consumers returning to their shopping habits with a continued emphasis on digital.”