Inflation Picked Up in December

Inflation picked up to 3.4% in December, after a rapid cooling through most of 2023.

Economists surveyed by The Wall Street Journal estimated consumer prices overall rose 0.2% in December from the prior month and increased 3.2% from a year earlier. That compares with November’s 0.1% monthly gain and marks a small acceleration from that month’s 3.1% annual increase.

Core prices, which strip out volatile food and energy items, climbed 0.3% in December from the prior month, while rising 3.8% from a year earlier, economists estimated. That would be the same monthly increase as November, and a modest slowing from that month’s 4% annual increase.

Ebbing inflation means consumers are seeing their dollars go further, though pockets of fast-rising prices remain, such as those for auto insurance and repairs, and pharmaceuticals. The rapid cooling of core price increases over the past year has raised hopes of a soft landing, where inflation can be tamed without a surge in unemployment or a recession.