The underlying inflation in the United States likely increased in January, possibly marking the most significant rise in a year, according to the Federal Reserve’s preferred metric.

The core personal consumption expenditures price index, which excludes food and energy costs, is anticipated to show a 0.4% increase from the previous month.

This would signify the second consecutive monthly acceleration in a metric that has generally declined over the past two years.

On an annualized basis, both three- and six-month data would rebound to exceed 2%, after having fallen below the Fed’s target in December, Bloomberg reported.

Federal Reserve officials have emphasized their cautious approach to reducing borrowing costs, indicating that they will only consider such measures when they are confident in a sustained retreat of inflation.

Written by B.C. Begley