U.S. Core Inflation Slows for the First Time in Six Months

While the easing is welcome after months of elevated readings, a series of subdued readings would be needed to convince Fed officials that they are again making adequate progress on inflation.

By Molly Smith | January 15, 2025 at 03:26 PM

U.S. consumer prices rose in December by less than forecast, after months of faster underlying inflation persuaded the Federal Reserve to signal a pause in interest rate cuts. The so-called core consumer price index (core CPI)—which excludes food and energy costs—increased 0.2 percent, after rising 0.3 percent four straight months, Bureau of Labor Statistics (BLS) figures showed Wednesday. From a year ago, the core CPI rose 3.2 percent.

Economists see the core gauge as a better indicator of the underlying inflation trend than the overall CPI, which includes often-volatile food and energy costs. That headline measure rose 0.4 percent from the prior month, with more than 40 percent of the advance due to energy.

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U.S. Core Inflation Slows for the First Time in Six Months

While the easing is welcome after months of elevated readings, a series of subdued readings would be needed to convince Fed officials that they are again making adequate progress on inflation.

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U.S. Core Inflation Slows for the First Time in Six Months

While the easing is welcome after months of elevated readings, a series of subdued readings would be needed to convince Fed officials that they are again making adequate progress on inflation.

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