Inflation in the Pacific Region-January 2026

All of the data discussed in this report come from the U.S. Bureau of Labor Statistics’ Consumer Price Index (CPI)[i] database. This source no longer produces estimates of price levels in Oregon nor any metropolitan area within Oregon, so this report references data from the Pacific region (Alaska, California, Hawaii, Oregon, and Washington.)[ii]

Inflation Still on the Radar: Progress, but Persistent Regional Pressures

Inflation in the Pacific region continues to run above the national average, even as 2026 begins with a broader national trend of cooling inflation. Over the two months from November 2025 to January 2026, consumer prices in the Pacific region rose by 0.4 percent. On a year-over-year basis, regional inflation remains elevated, driven primarily by significant cost increases in medical care, recreation, and various services.

Over the 12 months ending in January 2026, the Consumer Price Index for All Urban Consumers (CPI-U) in the Pacific region increased 2.9 percent, exceeding the 2.4 percent increase in the U.S. city average. The largest contributors to inflation in the region were medical care, recreation, services, and food. 

Core inflation—which excludes food and energy—also remains higher in the Pacific region than nationally. Over the same 12-month period, the national core CPI rose 2.5 percent, while regional pressures in medical care and recreation have kept local price growth more robust, 3 percent. This divergence indicates that while headline inflation is moderating, the underlying costs for essential services continue to apply disproportionate pressure on households across the Pacific region.

At the national level, the Federal Reserve paused its cycle of rate cuts at the start of the year. At its January 2026 meeting, the Federal Open Market Committee maintained the federal funds target range at 3.5%–3.75%. This “wait-and-see” approach comes as policymakers weigh a cooling national headline inflation rate against persistent inflation in core services excluding shelter.

The CPI-U for the Pacific region increased 0.4 percent over the 2 months from November 2025 to January 2026. Over the 12 months ending in November, prices rose 2.9 percent, exceeding the 2.4 percent increase in the U.S. city average.

Key Takeaways:

•  Over the 12 months ending in January 2026, the CPI for the Pacific region rose 2.9 percent, exceeding the national average of 2.4 percent. The largest contributors to the increase were medical care, recreation, services, and food.
• The Consumer Price Index for All Urban Consumers in the Pacific region increased 0.4 percent over the 2 months from November 2025 to January 2026.

Sectoral Price Changes^[iii]

The inflationary environment has cost the average household in the Pacific region nearly $55,000 compared to 2020 spending levels, with Housing and 

Transportation accounting for nearly half of this increase.

• From January 2025 to January 2026, the largest price increases were seen in:  Medical Care (5.5%), Services (3.6%) and Recreation (3.4%).
• Inflation in Durables, Education and Energy prices were the smallest.

The Pacific region saw above-average annual price growth in:

• Medical Care (5.5% vs. 3.2%)

• Recreation (3.4% vs. 2.6%)

• Food (3.2% vs. 2.9%)

• Transportation (1.5% vs. -1.1%)

• Services (3.6% vs. 3.2%)

• Energy (0.7% vs. -0.1%)

• Commodities (1.4% vs. 1%)

From January 2025 to January 2026, price growth in the Pacific region was slower than the national average across several categories—Apparel (1.3% vs. 1.7%), Durables (-0.1% vs. 0.5%), Education (0% vs. 0.6%), Housing (3.1% vs. 3.4%).