Inflation climbs faster than expected in December as high prices persist
Former Reagan economist Art Laffer discusses inflation, recession concerns and the impact of the election on the economy.
Inflation rose more than expected in December thanks to a jump in energy and housing costs, underscoring the challenge of taming price pressures within the economy.
The Labor Department said Thursday that the consumer price index, a broad measure of the price of everyday goods including gasoline, groceries and rent, rose 0.3% in December from the previous month, more than expected.
Prices climbed 3.4% from the same time last year, coming in above both the expectation from Refinitiv economists and the 3.1% gain recorded in November.
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Other parts of the report indicated that inflation is continuing to retreat, albeit slowly. Core prices, which exclude the more volatile measurements of food and energy, climbed 0.3%, or 3.9% annually. Both of those figures are slightly higher than estimates; however, it marked the first time since May 2021 that core inflation fell below 4%.
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Altogether, the report indicates that while inflation has fallen considerably from a peak of 9.1%, it remains above the Federal Reserve's 2% target.
High inflation has created severe financial pressures for most U.S. households, which are forced to pay more for everyday necessities like food and rent. The burden is disproportionately borne by low-income Americans, whose already-stretched paychecks are heavily affected by price fluctuations.
A window display at the Vacation Supply Co. on Collins Avenue in Miami Beach, Florida. (Jeffrey Greenberg/Universal Images Group via / Getty Images)
FED EXPECTED
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