US consumer prices rise more than expected in December; weekly jobless claims fall

economictimes.indiatimes.com:

U.S. consumer prices increased more than expected in December as rents maintained their upward trend, which could delay a much anticipated interest rate cut in March from the Federal Reserve.

The consumer price index (CPI) rose 0.3% last month after nudging up 0.1% in November, the Labor Department's Bureau of Labor Statistics said on Thursday. The cost of shelter accounted for the more than half of the increase in the CPI.

In the 12 months through December, the CPI rose 3.4% after increasing 3.1% in November. Economists polled by Reuters had forecast the CPI gaining 0.2% on the month and climbing 3.2% on a year-on-year basis.

Since slowing to an annual increase of 3.0% last June, further progress towards lower consumer inflation has been limited by persistently high rents. The annual increase in consumer prices has cooled from a peak of 9.1% in June 2022.

The report followed news last Friday that the economy added 216,000 jobs in November, with annual wage growth picking up.

Excluding the volatile food and energy components, the CPI rose 0.3% last month after increasing 0.3% in November. The so-called core CPI advanced 3.9% on a year-on-year basis in December after rising 4.0% in November.

Though consumer prices remain elevated, measures tracked by the U.S. central bank for its 2% inflation target improved significantly through much of 2023, with the personal consumption expenditures (PCE) price index posting its first monthly decline in more than 3-1/2 years in November.

Rents, which account for a larger share of the CPI basket, have a smaller weighting in the PCE price index, which will be published later this month.

Early on Thursday, financial