US inflation swells to 7.5% in January 2022, highest in four decades

11 Feb 2022 , 11:24 AM

US inflation reached its highest rate in the past four decades signalling for aggressive rate hikes from US Federal Reserve going ahead. US inflation is at 40-years high and markets globally reacted on a bearish note with technology stocks in a free fall. US inflation soared on the back of higher prices in food, electricity, and shelter.

The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.6% in January 2022 on a seasonally adjusted basis, the U.S. Bureau of Labor Statistics reported. Over the last 12 months, the all items index increased 7.5% before seasonal adjustment.

As per the Labor Statistics Department, increases in the indexes for food, electricity, and shelter were the largest contributors to the seasonally adjusted all items increase. The food index rose 0.9% in January following a 0.5-per cent increase in December. The energy index also increased 0.9% over the month, with an increase in the electricity index being partially offset by declines in the gasoline index and the natural gas index.

Further, the index for all items less food and energy rose 0.6% in January, the same increase as in December. This was the seventh time in the last 10 months it has increased at least 0.5%. Along with the index for shelter, the indexes for household furnishings and operations, used cars and trucks, medical care, and apparel were among many indexes that increased over the month.

The all items index rose 7.5% for the 12 months ending January, the largest 12-month increase since the period ending February 1982. The all items less food and energy index rose 6.0%, the largest 12-month change since the period ending August 1982. The energy index rose 27.0% over the last year, and the food index increased 7.0%