The first few months of the year have historically seen an outsized share of eventual price increases for the year, although that pattern broke down in the early post-pandemic years as firms passed on cost increases at faster than usual rates. January accounted for an average 20% of eventual price rises in each year through 2017-19 (or 40% for Jan & Feb combined). That share plunged to just 3.5% in 2021 (10% for Jan & Feb) but since increased to 16% in 2023 and 17% in 2024 (35% for Jan & Feb). Wednesday’s annual revisions to seasonal adjustment factors could continue to see some normalization here, with the seasonal adjustment process essentially “looking” for larger relative increases this month compared to the past few years, but it’s very hard to know by how much.
