By Sarah Chaney and Amara Omeokwe
WASHINGTON-U.S. consumer prices rose slowly in December, signaling inflation continued to moderate heading into 2020.
The consumer-price index-which measures the costs of everyday goods and services from food to dental care-rose a seasonally adjusted 0.2% in December from a month earlier, down from a 0.3% increase in November, the Labor Department said Tuesday. Core prices, excluding often volatile food and energy categories, increased 0.1% after logging 0.2% increases in October and November.
Energy prices climbed in December, helping push up overall inflation during the month. Food prices rose from November.
From a year earlier, consumer prices were up 2.3% in December, up from the 2018 increase of 1.9%. That mainly appeared to reflect a sharp rise in gas prices over the year. Core consumer prices increased 2.3% in December from a year earlier, the third such consecutive rise.
A separate Labor Department report released Tuesday showed U.S. inflation-adjusted wages cooled in December. Real average weekly earnings were down 0.1% from a month earlier due to a decline in real average hourly earnings and an unchanged workweek.
The Federal Reserve follows the consumer-price index for clues about the trajectory of inflation, though the central bank's inflation target of 2% is tied to a separate measure, the Commerce Department's price index for personal-consumption expenditures. The consumer-price index tends to run a bit higher than the personal-consumption index, but both gauges generally follow the same path.
The price index for personal-consumption expenditures, the Federal Reserve's preferred gauge for inflation, rose 1.5% in November from a year earlier, undershooting the Fed's target.
Federal Reserve officials generally expect inflation will return to the Fed's 2% objective as labor markets tighten, according to the most recent Fed meeting minutes. So far, though, as some more skeptical Fed officials noted, tighter labor markets over the past couple of years haven't exerted strong upward pressure on prices. They noted global or technology-related factors could be keeping a lid on inflation and might be difficult to overcome.
Write to Sarah Chaney at firstname.lastname@example.org
(END) Dow Jones Newswires
January 14, 2020 08:45 ET (13:45 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.