Prices rose 2.7% in 2025 as inflation stalked the economy

January 13, 2026

TL;DR

Inflation rose 2.7% for the year ending in December, down from previous highs but above the Fed's 2% target.
Core inflation, excluding food and energy, was 2.6% for the same period.
In December alone, prices increased by 0.3%.
Prices for some food items like chicken, milk, and cheese have decreased, but ground beef, steaks, and coffee have significantly increased.
Electricity prices rose 6.7%, while gasoline costs decreased.
The latest CPI report comes before the Fed's meeting to decide on interest rates, with investors expecting rates to be held steady.
The economy added 50,000 jobs in December, and the unemployment rate fell to 4.4%, though the three-month moving average of job gains was negative.
Year-ahead inflation expectations are at 4.2%, the lowest since January 2025 but still above the Fed's target.
Fed Chair Jerome Powell is under Justice Department investigation related to testimony about renovation cost overruns, which he believes is politically motivated.
Trump has been advocating for the Fed to cut interest rates.

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