December Annual Inflation Holds Steady; Core CPI Rises Less Than Expected

10:26 AM EST, 01/13/2026 (MT Newswires) -- US consumer inflation held steady year over year last month, while core prices grew less than projected, government data showed Tuesday.

The consumer price index rose 2.7% annually in December, unchanged from November's year-over-year change, the Bureau of Labor Statistics reported. The print was in line with the Bloomberg-polled consensus.

"Inflation remained steady in December," TD Economics Senior Economist Leslie Preston said in a note. "It was encouraging to see core goods prices stand pat after a period of firming. Similarly, core services continued to cool on a trend basis."

Consumer prices increased 0.3% month over month, as expected. October and November data were not available due to the recent government shutdown, the BLS said.

Core CPI, which excludes food and energy prices, rose 2.6% year over year, missing the consensus estimate that called for a 2.7% increase. The measure edged 0.2% higher on a monthly basis, below analysts' expectation for a 0.3% gain.

"Core inflation is tracking slightly cooler than our December forecast, but we still expect the knock-on effects from tariffs will push inflation higher over the coming months," Preston said. "This is likely to lead the (Federal Reserve) to push pause on its interest rate cuts for at least a couple of meetings."

Following the inflation report, President Donald Trump called on Fed Chair Jerome Powell to cut interest rates "meaningfully." Trump has repeatedly criticized Powell as the Fed took a cautious view on lowering rates.

On Sunday, Powell said federal prosecutors served the central bank with grand jury subpoenas threatening a criminal indictment linked to his earlier testimony regarding office building renovation. Powell suggested the probe reflected continued efforts by the Trump administration to influence monetary policy.

The probability of the Federal Open Market Committee keeping its benchmark interest rate unchanged later this month rose to 97% on Tuesday from 96% on Monday, according to the CME FedWatch tool.

MT Newswires does not provide investment advice. Unauthorized reproduction is strictly prohibited.