The worsening financial conditions and slower growth in the United States have had some effect on the rest of the world, but the prospects for foreign growth remain favorable. The most recent news on inflation – the January report on the consumer price index (CPI) – was disappointing.
Once again, total or headline CPI was boosted by a jump in energy prices and relatively large increases in food prices; last month's rise left the twelve-month change in the overall CPI at 4.3 percent – twice the pace a year ago.