Last month, the data showed prices ticked up for many items, including used cars, airline fares, medical care and car insurance.
Grocery prices climbed 0.3% over the month and were up 1.8% from a year ago.
Rents and other housing prices – which have been among the biggest drivers of inflation – rose 0.3% from November, the same pace as in the prior month. They were up 4.6% compared with December 2023.
Petrol prices rose 4.4% from November, but remained lower than a year ago.
The Fed is widely expected to keep its key rate, which now stands at about 4.3%, unchanged at its meeting this month.
Tina Adatia, head of fixed income for client portfolio management at Goldman Sachs Asset Management, said inflation would have to cool more for the Fed to cut further but that today’s data would keep those hopes alive.
“While today’s release is likely insufficient to put a January rate cut back on the table, it strengthens the case that the Fed’s cutting cycle has not yet run its course,” she said.
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