U.S. markets ticked higher on Friday after the sharp decline seen the day before. At the close in New York, the Dow finished at 49,501 points, up 0.1 % from the previous session. The Nasdaq 100 ended the day at 24,733 points, a 0.2 % gain, while the broader S&P 500 closed at 6,836 points, up 0.1 %.
Later in the afternoon, January inflation data were released. The headline U.S. inflation rate fell unexpectedly from 2.7 % to 2.4 %. Even after stripping out volatile energy and food prices, core inflation declined from 2.6 % to 2.5 %.
Thomas Gitzel, chief economist at VP Bank, remarked that the most striking aspect of the U.S. inflation picture is that tariffs have not yet exerted significant inflationary pressure. He attributed this to higher labor productivity in the second and third quarters. “According to the U.S. statistics agency, productivity rose by about 5 % each quarter. Those gains should at least partly offset the impact of tariff increases” Gitzel explained.
He also cautioned that in the coming months some of the tariff‑related rise in purchase costs may still be passed on to consumers. Surveys from the Fed suggest this possibility, but the January inflation data do not compel the Fed to take any immediate action.