U.S. inflation picked up last month as prices rose for gas, eggs, and used cars, yet underlying price pressures showed signs of easing, the Associated Press reports.
Wednesday’s report from the Labor Department showed that the consumer price index rose 2.9% in December from a year ago, the highest since July. It was the third straight increase after inflation fell to a 3.5-year low of 2.4% in September.
Excluding the volatile food and energy categories, however, so-called “core” inflation declined to 3.2%, after remaining stuck at 3.3% for three months in a row.
The slowdown in core price increases comes as a relief as many economists and investors have worried that inflation has gotten stuck above the Fed’s 2% target, after a steady decline in prices in 2023 and for much of last year.
Such concerns have sent interest rates on Treasury securities higher, which has also pushed up borrowing costs for mortgages, cars, and credit cards, even as the Fed has cut its key rate.
