Inflation was up slightly in December, though that might not be as bad as it seems.
With energy and housing prices up, overall U.S inflation was up, as well, despite 11 increases in interest rates from the Federal Reserve since March 2022.
The Labor Department reported Thursday that overall prices rose 0.3% from November and 3.4% from 12 months earlier. Those gains were higher than the previous 0.1% monthly rise and the 3.1% annual inflation in November. The December figures were slightly above economists’ forecasts, according to a report from The Associated Press.
More than half the increase in prices from November to December reflected higher housing costs. Energy costs, led by electricity and gasoline, along with food prices, also contributed to inflation, the news service reported.
Not counting food and energy costs, though, so-called core prices rose just 0.3% month over month, unchanged from November’s increase. Core prices were up 3.9% from a year earlier — the mildest such pace in nearly two years.
Inflation has cooled more or less steadily since hitting a four-decade high of 9.1% in mid-2022.
Over the past year, consumers have enjoyed some price declines for some individual items. Furniture and bedding prices are down 4%, for example. Men’s suits and coats are down 6%, televisions 10%, sporting goods nearly 3%, sausages nearly 4%.
The Federal Reserve began aggressively raising interest rates in March 2022 to try to fight inflation and wants to bring it down to its 2% target level.
Many economists have suggested that slowing inflation from 9% to around 3% was easier to achieve than reaching the Fed’s 2% target could prove to be, the AP reported.
“Inflationary pressures, while generally inching lower, remain stubbornly higher than expectations as the so-called ‘last mile’ requires more time to reach the final goal,″ Quincy Krosby, chief global strategist for LPL Financial, told AP.
