How US Inflation, Consumer Price Index Looked in December

How US Inflation, Consumer Price Index Looked in December

Jon Cherry/Getty Images

  • The latest data from the BLS shows that inflation is still above target at the end of 2023.
  • The consumer price index increased by 3.4% from December 2022 to December 2023.
  • The year-over-year change was higher than forecast.

December Consumer price index It rose 3.4% year-over-year, according to data released Thursday by the Bureau of Labor Statistics.

This increase is more than a 3.1% increase november. Annual CPI growth for December was expected to be 3.2%. The new data point means that inflation It cooled through most of 2023, then rose again and was still above the Fed’s 2% target as the year closed.

“CPI inflation is moving in the right direction, but this release should overturn any concerns investors may have about a March rate cut from the Fed,” said Greg McBride, chief financial analyst at Bankrate.

Media is not supported by AMP.
Tap for the full mobile experience.

Looking at the seasonally adjusted change, the CPI rose 0.3% from November to December, after the CPI rose 0.1% in November. This is 0.2% more than forecast.

“The shelter index continued to rise in December, increasing more than half of all items monthly,” the BLS said in a news release.

Excluding volatile food and energy prices, the core CPI rose 3.9%, following a 4.0% annual increase in November. December’s percentage change was above expectations of 3.8%.

For the month alone, core CPI rose 0.3% in December compared to the previous month. This was also the forecast for this event, and the increase compared to November was also 0.3%.

“The energy index rose 0.4 percent in December after falling 2.3 percent in November,” he said. “Gasoline index increased by 0.2 percent in December after decreasing by 6.0 percent in the previous month.”

Year-over-year, the energy index fell 2.0% in December, which was not as large as the 5.4% annual decline in November.

The food index rose 0.2% in December from November, the same increase as in the previous month.

The food index rose 2.7% year-on-year after a 2.9% rise in November. This means that this index continued to cool during the year.

The shelter index is very cold based on percentage changes from year to year. The index rose 6.2% in December, slightly below the 6.5% increase in November. It has slowed since the peak earlier in the year, but is still high. Meanwhile, the shelter index rose 0.5% month-on-month in December, slightly higher than the monthly increases seen in October and November.

Despite some acceleration during part of the year, inflation was generally on track to cool in 2023. Year-over-year changes were down from the peak in June 2022.

“Inflation has come down from its peak, and that has come without a significant increase in unemployment,” Fed Chairman Jerome Powell said at a press conference in December.

The information released last Friday added to Powell’s opinion. December’s unemployment rate, part of labor force data released on Friday, showed the rate for the second month in a row at 3.7%.

Powell noted at a December press conference that “inflation is still very high.”

“As we look ahead to next year, I want to assure the American people that we are fully committed to returning inflation to our 2% target,” Powell said. “Restoring price stability is essential to achieving a sustained cycle of strong labor market conditions that benefit everyone.”

The Federal Open Market Committee will meet at the end of the month.

Leave a Comment

Your email address will not be published. Required fields are marked *