Inflation in the US rises more than expected in December to 3.4%

The inflation in the United States closed in December 2023 with a stronger than expected year-on-year rebound, due in particular to housing prices, according to the CPI index released on Thursday by the Department of Labor.

The Consumer Price Index (CPI) of the Department, a key indicator of inflation, rose 3.4% in December compared to the same month of the previous year and above the November figure.

From November to December, the CPI increased 0.3% month-on-month.

However, inflationcore” – which excludes volatile food and energy prices – fell to 3.9% in the last month of the year.

Although analysts do not expect the Federal Reserve (Fed) base the level of interest rates on one month’s data, accelerating inflation could add pressure to the US central bank.

Fed policymakers quickly raised interest rates starting in early 2022 and have kept them at a high level ever since.

The objective is to alleviate credit demand and be able to reduce inflation in a sustainable way by making it more attractive to save than to spend.

Despite the CPI rebound in December, inflation has decreased significantly from the peak of 9.1% reached in June 2022, while consumer spending and the labor market remained resilient.

This fuels hopes of what is called a “soft landing” for the world’s largest economy, according to which inflation can cool without registering a damaging recession.

The American president, Joe Bidenadmitted on Thursday, after the release of the data, that his government must do more to confront rising prices despite having achieved notable progress in terms of employment and salaries.

“The economy has created more than 14 million jobs since I took office (ndlr, in 2021) and wealth, wages and employment are higher now than under my predecessor. But there is much more work to do to reduce costs for American families and workers.“Biden said in a statement.