Story perspectives

December CPI Shows Inflation Rise Amid Government Shutdown

1/12/2026

Summary

Story summary

The U.S. Consumer Price Index (CPI) for December is expected to show a headline year-over-year inflation of 2.6%–2.8%, with core inflation around 2.7%.
Analysts expect a month-over-month increase of roughly 0.2%–0.4% for December CPI.
The U.S. government shutdown has complicated data collection, potentially distorting the inflation narrative.
The Personal Consumption Expenditures (PCE) price index inflation report is delayed until January 22, 2026, which may clarify these trends.

History

Historical Context

In 1980, the U.S. faced a severe inflation rate of 13.55%, largely due to oil crises and economic instability. To combat this, Federal Reserve Chairman Paul Volcker raised interest rates to 20%, leading to a recession. Today, projected CPI inflation is 2.6%–2.8%, reflecting ongoing economic challenges, including the impact of a recent government shutdown on data accuracy.

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Story summary

The U.S. Consumer Price Index (CPI) for December is expected to show a headline year-over-year inflation of 2.6%–2.8%, with core inflation around 2.7%.
Analysts expect a month-over-month increase of roughly 0.2%–0.4% for December CPI.
The U.S. government shutdown has complicated data collection, potentially distorting the inflation narrative.
The Personal Consumption Expenditures (PCE) price index inflation report is delayed until January 22, 2026, which may clarify these trends.

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