US Core CPI Comes In Lower Than Anticipated For December, Approaching Lowest Levels In Nearly Five Years

Latest CPI Report Offers Insight into Fed's Dual Mandate

Following encouraging labor market updates—including a drop in unemployment from the BLS, continued positive job growth according to ADP, and renewed optimism among small businesses—attention has now shifted to inflation data as the final Consumer Price Index (CPI) reading for 2025 is released. Unlike previous occasions, President Trump refrained from making any advance comments before the data was published, which analysts had anticipated would remain unchanged from November’s figures.

The headline CPI increased by 0.3% month-over-month, matching expectations, and pushed the annual inflation rate to 2.7%, also in line with forecasts. Many observers had predicted a rise in December’s numbers, attributing it to the normalization of earlier market distortions.