Inflation will decrease in December
brand new Data A key measure of inflation fell for the first time since July, the Bureau of Labor Statistics showed on Wednesday.
According to the “core,” the more volatile measure of food and gas costs, December’s consumer price index (CPI) rose 0.2% from the previous month, down from November’s 0.3% monthly gain. Prices rose 3.2 percent year-on-year.
Prior to the December publication, core CPI had been stuck at a 3.3% annual gain for the previous four months. It was the first time in more than a year that the core CPI had seen price growth decline since July.
The publication is the latest economic data the Federal Reserve will consider ahead of its next interest rate decision later this month.
Core consumer prices rose as predicted in December. CPI rose 2.9 percent in December from a year earlier, up from 2.7 percent in November. The annual increase is in line with economists’ expectations.
The index rose 0.4% from the previous month, matching November’s 0.3% increase and also in line with economists’ estimates.
Current factors such as high fuel costs and sticking to food inflation have boosted the headlines.
Core inflation has continued stubbornly due to high costs of accommodation and services such as insurance and medical care. Used car prices posted another strong increase for the third straight month, rising 1.2 percent in December after a 2 percent monthly gain in November.
Although inflation has been slowing, it has remained above the Federal Reserve’s annual target of 2 percent.
The election of Donald Trump as the country’s president further complicated the outlook. They argue with some economists. If Trump follows through on his key campaign promises, the US could experience another inflationary rebound. The president-elect will be sworn in next week.
Trump’s proposed policies, such as tariffs on imported goods, corporate tax cuts and immigration bans, are considered inflationary. And these policies drive central bank interest rates forward.
Stock futures immediately rose after the report, with the 10-year Treasury yield (^TNX) up 3 basis points to trade above 4.7 percent.
Notable calls from inflation included the shelter index, which was flat at 4.6 percent on an annual basis, slightly lower than November’s 4.7 percent increase and the smallest 12-month increase since January 2022. The index increased by 0.3% from last month. Corresponding to November.
