The annual inflation rate is on the rise again after moderating slightly in October in November, according to a new report from the Bureau of Labor Statistics.
The Consumer Price Index for All Urban Consumers (CPI-U), a key metric used to measure inflation, increased 0.3 percent in December after rising 0.1 percent in November.
At an annual rate, inflation rose to 3.4 percent, a significant increase from the 3.1 percent annual rate in November.
The numbers were larger than economists expected, as noted by CNBC, with predictions of a 0.2 percent increase in December and a 3.2 percent annual rate.
The inflation rate, combined with a decrease in the average workweek, resulted in a decrease of 0.2 percent in real average weekly earnings for American workers.
The rise in inflation was largely driven by an increase in shelter prices which increased 0.5 percent in December.
“These are not bad numbers, but they do show that disinflation progress is still slow and unlikely to be a straight line down to 2%,” said Seema Shah, chief global strategist at Principal Asset Management, according to CNBC. “Certainly, as long as shelter inflation remains stubbornly elevated, the Fed will keep pushing back at the idea of imminent rate cuts.”
