by: Caleb Bray, Jordan Rappaport and Shu-Kuei X. Yang
Inflation from core services excluding housing—or “supercore” inflation—jumped in January, contributing 0.4 percentage points to core CPI inflation, up from 0.1 percentage points in December.

Sources: U.S. Bureau of Labor Statistics (Haver Analytics) and authors’ calculations.

Inflation from core services excluding housing—or “supercore” inflation—increased in January, contributing 0.24 percentage points to core Consumer Price Index (CPI) inflation, up from 0.11 percentage points in December (green bars). Of the three primary components of core CPI inflation—core goods, housing services, and supercore—supercore inflation is the most labor intensive and therefore especially sensitive to nominal wage increases. Although nominal wage increases moderated during 2023, they remain above their pre-pandemic levels, continuing to put upward pressure on supercore inflation.

Note: This chart replaces an earlier version to correct the calculation of supercore inflation.

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Authors

Caleb Bray

Research Associate

I joined the Federal Reserve Bank of Kansas City in July of 2023 after graduating from the University of Iowa with a BS in Economics and Mathematics and a BA in Public Policy. I …

Jordan Rappaport

Senior Economist

Jordan Rappaport is a senior economist at the Federal Reserve Bank of Kansas City. He joined the Bank in 1999 following completing his Ph.D. in economics at Harvard University. J…