U.S. inflation pressures appear to be easing slightly, with the Core Consumer Price Index (CPI) rising by 0.2% in December 2024, lower than analysts’ expectations of a 0.3% increase. Notably, year-over-year inflation is reported at 4.5%, which is a decrease from the 5.6% seen in November. The decrease in inflation was attributed to falling energy prices and a slowdown in costs for shelter, which rose just 0.3%. According to Michael Feroli, the Chief U.S. Economist at JPMorgan, ‘It’s a hopeful sign that inflationary pressures may be waning.’ Additionally, the overall Consumer Price Index edged up 0.4% for the month, combining both food and energy prices that continue to fluctuate. The report has sparked discussions about potential Federal Reserve actions moving forward, with many economists suggesting that the central bank could pause interest rate hikes as part of its strategy to combat inflation. The economic outlook for 2025 anticipates further moderation in inflation rates, granting relief to consumers amidst rising wage pressures and remaining elevated housing costs. ‘The path to recovery is becoming clearer,’ said former Treasury Secretary Lawrence Summers, reflecting on the latest data.
Core CPI Rises Less Than Forecast as Inflation Pressures Ease Slightly in December 2024
