๐๐#CPIWatch ๐๐
๐ As of January 5, 2026, U.S. inflation remains moderate but above the Federal Reserve's 2% target, with the latest available data showing headline CPI rising 2.7% year-over-year through November 2025.
๐ The Bureau of Labor Statistics reported disruptions from a 2025 federal government shutdown, skipping the October CPI release and combining September-November changes into a modest 0.2% bimonthly increase.
๐ Core CPI, excluding food and energy, advanced 2.6% annually in November, reflecting cooling shelter costs and stable energy prices.
๐ Key drivers include persistent shelter inflation still elevated despite slowing rent growth and subdued energy contributions, with gasoline prices fluctuating mildly. Food prices rose steadily, while services showed resilience.
๐ The highly anticipated December 2025 CPI report, due January 13, 2026, at 8:30 a.m. ET, will provide the first full monthly reading since September.
๐ Economists anticipate headline inflation around 2.8-2.9% year-over-year, with core measures near 2.7%, influenced by seasonal factors and potential tariff effects lingering from prior policy changes.
๐ Looking ahead, forecasts for 2026 suggest inflation easing toward 2.4-2.8% by year-end, per surveys like the Philadelphia Fed's, though risks from trade policies, fiscal stimulus, or labor market tightness could push it higher.
๐ The Fed's preferred PCE gauge aligns similarly, projecting gradual disinflation amid resilient growth. Markets watch closely, as persistent above-target readings may delay further rate cuts.
๐ Overall, inflation's downtrend continues, offering relief from 2022 peaks, but full normalization remains elusive.
