Updated Jan 11, 2024 - Economy

Consumer prices rose more than expected in December, new inflation data shows

Data: U.S. Department of Labor; Chart: Axios Visuals
Data: U.S. Department of Labor; Chart: Axios Visuals

Inflation pressures reignited as energy and shelter prices rose: the Consumer Price Index rose 0.3% in December, the Labor Department said on Thursday.

Why it matters: Inflation picked up at the end of the year, interrupting a cooldown that continued for much of 2023.

By the numbers: CPI's 0.3% rise compares to the 0.1% increase in November.

  • The overall CPI was up 3.4% over the last 12 months, compared to 3.1% in November.
  • An underlying gauge of inflation, core CPI — which excludes energy and food costs — rose 0.3%, matching the prior month's pace. In the year through December, it's up 3.9% — down from the 4% rise in November.

Details: Rebounding energy costs and high housing costs helped push up overall inflation.

  • The energy index rose 0.4% in December, after falling by more than 2% in November. The gasoline index rose by 0.2%, after a 6% plunge the prior month.
  • Housing prices also picked up slightly, with the overall shelter index rising 0.5% in December (up from the 0.4% increase in November).

The bottom line: Inflation is well below the peak reached in 2022. But a complete return to normal — with mild price increases that defined pre-pandemic times — might not happen as quickly as policymakers would like.

Editor's note: This story was updated with additional details and a new chart.

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