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Macro BriefFebruary 20268 min read

U.S. Inflation Watch:
January 2026 CPI Signal.

The January 2026 CPI release showed a slower year-over-year pace while core inflation remained firm. The main portfolio question is whether disinflation is broadening fast enough to support lower real yields.

What Changed in the Release

The headline CPI increased 0.2% month over month and 2.4% year over year. Core CPI (excluding food and energy) printed 0.3% month over month and 2.5% year over year. Shelter remained a key contributor, while energy declined over the month.

Portfolio Interpretation

We read the release as constructive but not decisive. Disinflation is visible in the headline series, yet services and core components still argue for policy patience. In this setup, portfolios benefit from balancing duration exposure with quality carry and resilient cash-flow assets.

Positioning Checklist

  • Keep duration selective rather than directional.
  • Favor quality balance sheets in rate-sensitive sectors.
  • Stress-test inflation assumptions in base-case allocations.

Source Notes

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