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The most recently released data from BLS shows inflation was still above the target at the end of 2023.The Consumer Price Index increased 3.4% from December 2022 to December 2023.That year-over-year change was above the forecast.
December’s Consumer Price Index climbed 3.4% year over year, according to data out Thursday from the Bureau of Labor Statistics.
That increase is higher than the 3.1% rise in November. The year-over-year CPI increase was expected to be 3.2% for December. The new data point means that while inflation has cooled during a lot of 2023, it ticked back up and was still above the Fed’s 2% target as the year closed.
After CPI rose 0.1% month-over-month in November when looking at the seasonally adjusted change, CPI rose 0.3% from November to December. That’s just above the forecast of 0.2%.
“The index for shelter continued to rise in December, contributing over half of the monthly all items increase,” the news release from BLS said.
Core CPI, excluding volatile food and energy prices, increased 3.9% after a 4.0% year-over-year increase in November. December’s percent change was above the 3.8% expected.
For just the month, core CPI increased 0.3% in December from the previous month. That was also the forecast for this measure, and November’s month-over-month increase was also 0.3%.
Despite some acceleration during part of the year, inflation was generally cooling in 2023. The year-over-year changes were below the peak in June 2022.
“Inflation has eased from its highs, and this has come without a significant increase in unemployment,” Fed Chair Jerome Powell said in a press conference held in December.
Data out last Friday added to Powell’s point. December’s unemployment rate, part of the workforce data released on Friday, showed the rate was 3.7% for the second month in a row.
Powell noted at the December press conference that “inflation is still too high.”
“As we look ahead to next year, I want to assure the American people that we’re fully committed to returning inflation to our 2% goal,” Powell said. “Restoring price stability is essential to achieve a sustained period of strong labor market conditions that benefit all.”
The Federal Open Market Committee will meet at the end of the month.
This is a developing story. Please check back for updates.
