Important points
- Core inflation rose 0.2% in December, lower than expectations of 0.3%.
- The annual growth rate of the consumer price index was stable at 2.7%.
U.S. inflation slowed in December 2025, with core CPI rising 0.2% from the month, lower than economists expected, the Bureau of Labor Statistics reported Tuesday.
On an annualized basis, core CPI rose 2.6%, matching a four-year low and reinforcing signs that inflation is easing.
Overall consumer prices, including food and energy, rose by 0.3% in the month, representing a year-on-year rate of increase of 2.7%, unchanged from November. Energy costs rose slightly due to higher natural gas prices, while food prices rose despite falling egg prices. Shelter costs continued to be the largest contributor to overall inflation.
Economists said the data were likely affected by an unusually long government shutdown, which delayed the collection of prices in October, led to assumptions about housing costs and holiday discounts may have contributed to the distortions.
The weaker-than-expected result will give the Fed more confidence in halting further rate cuts.
Economists said the data suggests underlying inflation is easing, reducing the need for immediate monetary stimulus, but the Fed will still consider tariff pressures and labor market trends.
Following the announcement, stock futures rose and US Treasury yields fell. Bitcoin remained range-bound around $92,000, with minimal reaction to the news.
