U.S. Consumer Prices Muted in December
By Sarah Chaney and Amara Omeokwe
WASHINGTON-U.S. consumer prices rose slowly in December,
signaling inflation continued to moderate heading into 2020.
The consumer-price index-which measures the costs of everyday
goods and services from food to dental care-rose a seasonally
adjusted 0.2% in December from a month earlier, down from a 0.3%
increase in November, the Labor Department said Tuesday. Core
prices, excluding often volatile food and energy categories,
increased 0.1% after logging 0.2% increases in October and
Energy prices climbed in December, helping push up overall
inflation during the month. Food prices rose from November.
From a year earlier, consumer prices were up 2.3% in December,
up from the 2018 increase of 1.9%. That mainly appeared to reflect
a sharp rise in gas prices over the year. Core consumer prices
increased 2.3% in December from a year earlier, the third such
A separate Labor Department report released Tuesday showed U.S.
inflation-adjusted wages cooled in December. Real average weekly
earnings were down 0.1% from a month earlier due to a decline in
real average hourly earnings and an unchanged workweek.
The Federal Reserve follows the consumer-price index for clues
about the trajectory of inflation, though the central bank's
inflation target of 2% is tied to a separate measure, the Commerce
Department's price index for personal-consumption expenditures. The
consumer-price index tends to run a bit higher than the
personal-consumption index, but both gauges generally follow the
The price index for personal-consumption expenditures, the
Federal Reserve's preferred gauge for inflation, rose 1.5% in
November from a year earlier, undershooting the Fed's target.
Federal Reserve officials generally expect inflation will return
to the Fed's 2% objective as labor markets tighten, according to
the most recent Fed meeting minutes. So far, though, as some more
skeptical Fed officials noted, tighter labor markets over the past
couple of years haven't exerted strong upward pressure on prices.
They noted global or technology-related factors could be keeping a
lid on inflation and might be difficult to overcome.
Write to Sarah Chaney at firstname.lastname@example.org
(END) Dow Jones Newswires
January 14, 2020 08:45 ET (13:45 GMT)
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