Posted on 01/18/2026 6:46:04 PM PST by SeekAndFind
Core U.S. consumer prices rose less than predicted in December, reinforcing hopes that inflation is tempering as the Federal Reserve contemplates its next move on interest rates.
Excluding volatile food and energy prices, the consumer price index showed a seasonally adjusted 0.2% gain on a monthly basis and 2.6% annually, the Bureau of Labor Statistics reported Tuesday. Both were 0.1 percentage point below expectations.
Though they look at both measures, Fed officials consider core inflation a better long-run gauge of where inflation is heading.
On a headline basis, the CPI posted an increase of 0.3% for the month, putting the all-items annual rate at 2.7%. Both were exactly in line with the Dow Jones consensus estimate.
The Fed targets inflation at 2% annually, so the report provides some evidence that the pace of price increases is moving back to target but remains elevated.
Stock market futures briefly rose following the report while Treasury yields were lower. Traders kept bets intact that the Fed would stand pat at its meeting later this month and likely won’t be considering another cut until June, according to the CME Group’s FedWatch gauge.
President Donald Trump used the CPI report to renew his calls on Fed Chair Jerome Powell and his colleagues to ease monetary policy.
“Great (LOW!) Inflation numbers for the USA. That means that Jerome ‘Too Late’ Powell should cut interest rates, MEANINGFULLY!!!,” Trump posted on Truth Social. “If he doesn’t he will just continue to be ‘TOO LATE!’”
Shelter, a key element of stickiness, increased 0.4%, which was the biggest item for the monthly increase, according to the BLS. The category accounts for more than one-third of the CPI weighting and was up 3.2% on an annual basis.
Other parts of the report also showed inflation persisting.
(Excerpt) Read more at cnbc.com ...
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Energy prices rose 0.3% on the month and were up 2.3% from a year ago, though gasoline declined 0.5% and 3.4%, respectively.
Some tariff-sensitive categories including apparel, also posted gains. However, household furnishings saw a 0.5% decrease as President Donald Trump backed off on threatened tariff increases for imports in that sector.
The 1.2% increase for recreation was the largest monthly gain ever for the index in data going back to 1993, the BLS said.
The report likely keeps the central bank on hold at least for the moment.
Nice of the Fed to aim for 2% inflation. Thanks
2.6% over 50 years will just about kill ya.
The Target should be no higher than 0.2%.
Yeah, but it will kill you slowly
RE: 2.6% over 50 years will just about kill ya.
Not if your GDP grows by 4% ( as it has been so far ) for 50 years. And USAFacts reports that from December 2024 to December 2025, nominal wages rose 3.8% while inflation was 2.7%, so real wages grew by about 1.1% over that year. So, we’re in good shape so far on the macro level.
It’s unemployment and the basic necessities — rent, housing, groceries and insurance that will be the battle to control Congress this coming November.
Guess what? It has now been exceeded for 55 CONSECUTIVE MONTHS!
Good job…/s
ROSE, ✖️
With no tariff money direct to the people.
Grade, Trump’s first 12 months:
..... C- .....
RE: With no tariff money direct to the people.
I’d rather it be used to pay off our ballooning debt.
I agree. It’s another ‘means tested’ (socialist light) type handout.
Dow Futures don’t like something, down 350!
Not surprised after the NATO/Greenland tariff threat…actually expected more here. Precious metals up a lot also.
Experts stunned?
Time to break up the big 5 meat packers. And the big two egg producers. And the big two bread makers.
NO.
I’ve been retired for ~20 years.
My pension [Sure, I’m fortunate to have one.] was not indexed for Inflation.
I’m being slowly screwed by The Fed.
Inflation is theft.
Over the years it’s Grand Theft while Powell spends 2 Billion on his Taj Mahal.
Not if you’re on a fixed income. Compounded inflation is devastating.
Meanwhile I don’t think I will be able to set up a scammy DareCare bidness....
Meanwhile I don’t think I will be able to set up a scammy DayCare bidness....
I’m 50 years in on owning a house.
There’s no way I’m going to sell that place and pay phantom/inflationary capital gains before I merge with the Universe.
Fortunately a kid wants to move in and take it on. [It’s in a Trust at the moment.]
Inflation is pure theft.
But you owe tax on the “gains”!
“Excluding volatile food and energy”
And Housing. Real estate.
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