US Core CPI Hits 0.3% in Jan: Inflation Stability Tests Federal Reserve Pivot Timelines

Market snapshot: The U.S. Core Consumer Price Index (CPI) for January 2026 rose 0.3% month-over-month, aligning with analyst estimates but accelerating from December's 0.2% reading. On an annualized basis, headline inflation cooled slightly to 2.4%, while core inflation—which excludes volatile food and energy—settled at 2.5%. These figures suggest that while the 'headline' heat is dissipating, underlying price pressures remain sticky, complicating the Federal Reserve's path toward interest rate cuts.

Summary: January Core CPI at 0.3% matches estimates; a slight uptick from previous months indicates persistent 'sticky' inflation that may delay Fed rate easing into H2 2026.

Key Takeaways

• Core CPI (MoM) at 0.3% signals service-sector price persistence despite softening goods inflation.
• Headline CPI (YoY) fell to 2.4%, but remains above the Fed's 2.0% target.
• Market expectations for a March rate cut are fading, as 'higher-for-longer' yields become the baseline.

SAHI Perspective

For Indian markets, a sticky US inflation print creates a dual challenge. First, it strengthens the USD, potentially putting the INR under pressure. Second, it limits the RBI's room to maneuver; if the Fed delays cuts, a premature Indian pivot could lead to capital outflows. Expect defensive sectors like IT and Pharma to remain volatile as global bond yields re-price. Investors should note India's own recent CPI rebasing (2024=100) which showed January inflation at 2.75%.

Closing Insight

While not a shock, this 'in-line' print removes the immediate possibility of an early spring Fed pivot. Stability is the new volatility.

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Synthetically modified: AI-generated content by Sahi Live News Engine.