The U.S. inflation rate rose 6.5% in December from a year ago, meeting the forecasts of economists.
According to the U.S. Labor Department, the Consumer Price Index (CPI) fell 0.1% in December from November, which was the largest monthly decrease since April 2020.
The 6.5% annual increase in inflation was the smallest gain since October 2021, indicating that higher interest rates are starting to bring consumer prices lower south of the border.
Excluding volatile food and energy prices, core CPI rose 0.3% in December, also meeting the economists’ forecasts. Core inflation was up 5.7% from a year earlier.
The latest inflation data is likely to influence future interest rate decision made by the U.S. Federal Reserve (Fed). Central bank officials are determining how much further they need to hike interest rates that are used to slow the economy and lower inflation.
Over the past year, the Fed has raised its benchmark interest rate 4.25 percentage points to its highest level in 15 years. Officials have indicated the rate is likely to exceed 5% before they can pivot away from policy tightening.
The Fed is scheduled to make it next decision on interest rates February 1.
