Core inflation in the United States was 4.9 per cent in December. The rise in prices is accelerating further and further from the Fed’s 2% target.
Consumer prices are on the rise in the United States. The country’s core inflation was 4.9 percent year-on-year in December, according to Reuters.
This is the biggest price increase since 1983.
The rise in consumer prices in the United States has accelerated in recent months. Core inflation was 4.7 per cent in November and 4.2 per cent in October.
Core inflation index measure changes in consumer prices without food and energy price developments. Core inflation indicators aim to monitor price developments that are not affected by temporary factors.
When food and energy price developments are included in inflation, the change in consumer prices in the United States was as high as 5.8 per cent in December.
The inflation figures now published are based on the PCE consumer price index produced by the US Department of Commerce. This index is calculated differently from the previously published Ministry of Labor consumer price index.
Read more: Inflation in the United States rose to as much as 7 percent
The US Federal Reserve’s flexible inflation target is 2 percent. According to Reuters, the Fed said on Wednesday that it is likely to raise interest rates in March.
Of the Americans consumer consumption fell 0.6 percent in December, Reuters says.
The reason is suspected to be the increase in infection rates caused by the coronavirus’ own micron transformation and the early consumption of Christmas time in the autumn, when consumers feared a possible shortage of goods caused by supply chain problems.
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