💸 CPI – December

MacroDrip

This is the December report that should carry more weight and provide the cleaner read that Powell has suggested the Fed needs.

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The inflation print for December just hit the tape, so let’s dive right in!

Here are the headline prints:

Year-over-Year:

✅ *US DECEMBER CPI RISES 2.7% Y/Y; EST. +2.7%
✅ *US DECEMBER CORE CPI RISES 2.6% Y/Y; EST. +2.7%

Month-over-Month:

✅ *US DECEMBER CPI RISES 0.3% M/M; EST. +0.3%
✅ *US DECEMBER CORE CPI RISES 0.2% M/M; EST. +0.3%

For a complete breakdown of last month’s CPI,
download our US Inflation Dashboard.

December CPI — Year-over-Year

Let’s start with our chart that shows the weight of the three main CPI categories and their respective sub-groups on the left. On the right, you can see how each item contributes to the overall index.
(see November CPI)

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Next up, we’ve got two charts breaking down Core CPI — one showing year-over-year (YoY) changes and the other highlighting month-over-month (MoM) shifts, focusing on items with the most disproportionate impact.

December Core CPI — Year-over-Year

(see November Core CPI YoY)

December Core CPI — Month-over-Month

(see September Core CPI MoM)

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Overall, a soft CPI print for December.

Core CPI was up 0.24% on the month, with some outsized drivers like Hotels, Admissions, and especially Airline Fares.

Notably, some items saw significant declines this time, particularly Telephone Services and Used Cars.

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On a year-over-year basis, Core CPI continues to be driven by the usual major contributors, mainly Shelter and Hospital Services.

Meanwhile, most of the excess YoY inflation still stems from Shelter. And as we’ve discussed many times before, official Shelter data significantly lags behind real-time private market indicators.