Prices rose 2.7% in December from a year ago, a sign that inflation continues rising but in line with the pace seen in recent months.

President Donald Trump said December inflation data supports his calls for Federal Reserve Chair Jerome Powell to cut interest rates after CPI showed 2.7% annual price growth.

U.S. consumer prices increased in December, lifted by higher costs for rents and food as some of the distortions related to the government shutdown that had artificially lowered inflation in November unwound,

Tuesday’s data revealed that the cost of living for Americans ticked higher in December as the consumer-price index rose 0.3% last month, leaving the annual rate of inflation at 2.7%, well above the Federal Reserve’s 2% target.

US consumers probably experienced only a modest pickup in inflation as 2025 drew to a close, consistent with price pressures that are gradually abating.

Food inflation continued to remain in negative territory for the seventh straight month, though pressures edged higher. The Consumer Food Price Index (CFPI) declined 2.71% year-on-year in December, compared with a sharper contraction of 3.