An inflation report is published by the government, typically by the central bank, and provides detailed information on current inflation rates. It includes data on price changes for various expenditure categories like housing, food, and transportation, and identifies factors driving inflation.
A Consumer Price Index (CPI) report measures the average change in prices paid by urban consumers for a market basket of goods and services, providing a key indicator of inflation. Published monthly by national statistical agencies, it includes data on categories like food, housing, and transportation. The CPI report helps policymakers, economists, and investors understand economic trends and make informed decisions.
Inflation December 2024
The Consumer Price Index (CPI) rose by 0.4% in December 2024, following a 0.3% increase in November. Over the past 12 months, the all items index saw an increase of 2.9%.
Energy Index:
- Increased by 2.6% in December, contributing to over 40% of the monthly all items increase.
- Gasoline index increased by 4.4% over the month.
Food Index:
- Increased by 0.3% in December.
- Both food at home and food away from home indexes rose by 0.3% each.
All Items Less Food and Energy:
- Rose by 0.2% in December, following 0.3% increases in each of the previous four months.
- Increases were seen in shelter, airline fares, used cars and trucks, new vehicles, motor vehicle insurance, and medical care.
- Decreases were observed in personal care, communication, and alcoholic beverages indexes.
Source: BLS report
12-Month Overview
The all-items index increased by 2.9% for the 12 months ending December.
The all items less food and energy index rose by 3.2% over the last 12 months.
The energy index decreased by 0.5% for the 12 months ending December.
The food index increased by 2.5% over the last year.
Impacts of December Inflation Data on Market
The inflation rate of 2.9% in December, which was in line with expectations, might provide some relief to investors who were concerned about higher inflation. This could lead to a positive sentiment in the market. The SPY, which tracks the S&P 500 index, might see some volatility as investors react to the inflation data. However, if the inflation rate remains manageable, it could support stock performance in the long run.
