Modest Inflation for December

This morning, the government released the inflation numbers for December. The good news is that inflation appears to be well under control.

For the month, the Consumer Price Index rose by 0.2%. That comes after a 0.3% increase in November. For the year, the CPI increased by 2.3% which close to the Fed’s target of 2%.

Digging into the numbers a bit, we see that the “core” rate of inflation increased by 0.1% last month. This is the regular inflation rate minus food and energy prices which can be very volatile. The core rate was up by 0.2% in November. For the year, the core rate increased by 2.3%.

Overall, these are good numbers and it looks like the Fed won’t need to make a move, in either direction, in the immediate future. It’s especially impressive that inflation is so low consider the unemployment is low as well.