Inflation Doesn't Budge in December

Inflation held steady last month as prices for gas and used cars fell, a sign that cost pressures may be slowly easing, per the AP.

• Consumer prices rose 0.3% in December from the prior month, the Labor Department said Tuesday, the same as in November. Excluding the volatile food and energy categories, core prices rose 0.2%, also matching November's figure.
• On an annual basis, overall prices rose 2.7% and core prices 2.6%, reports CNBC. Both are unchanged from November and in line with economists' expectations. The markets were little changed in the wake of the report.

• The report "shows the impact of tariffs is still relatively muted," per the Wall Street Journal. "And it offers a measure of relief to Federal Reserve officials who lowered rates last month." The Fed has a long-term goal of bringing annual inflation down to 2%.
• Food prices rose 0.7% for the month. Housing costs, transportation services, and medical care also rose in December, countering the decline in gas and used-vehicle prices.
• Inflation has come down significantly from the four-decade peak of 9.1% that it reached in June 2022, but it has been stubbornly close to 3% since late 2023. The cost of necessities such as groceries is about 25% higher than it was before the pandemic.