Inflation in the United States held steady in December, maintaining pressure on the Trump administration over the rising cost of living for American households. The latest official data shows prices remained stubbornly above the Federal Reserve's target.
Key Inflation Data Holds Firm
The closely monitored Consumer Price Index (CPI) rose by 2.7% in the year to December, matching the rate recorded in November. This figure was slightly ahead of the 2.6% forecast by economists. On a monthly basis, CPI increased by 0.3% in December.
The so-called "core" inflation index, which excludes volatile food and energy prices, rose by 0.2% from November to December. The persistence of inflation keeps it significantly above the Federal Reserve's long-term target of 2%.
Political Fallout and Public Sentiment
The release of the data comes as President Donald Trump faces mounting criticism over affordability. Despite the administration's claims that prices are falling, public opinion is shifting. A recent Harris Poll conducted for the Guardian revealed that twice as many Americans believe their financial situation is worsening rather than improving, with blame increasingly directed at the White House.
The Trump administration has consistently blamed the preceding Biden administration for lingering inflation. It is worth noting that inflation peaked at a four-decade high of 9.1% in June 2022, a period of global economic disruption following the Covid-19 pandemic.
Fed Independence Under Scrutiny
The inflation report lands amid an extraordinary clash over the independence of the US Federal Reserve. Although the central bank cut interest rates three times last year, it resisted President Trump's calls for more aggressive cuts, drawing intense criticism from him.
The situation escalated when Federal Reserve Chair Jerome Powell revealed that the Department of Justice had served the Fed with grand jury subpoenas, threatening a criminal indictment. This move has heightened concerns about political interference in the central bank's operations.
In a bid to address voter concerns, President Trump is scheduled to deliver a speech on the economy in Detroit. He has recently announced several policy measures, including a proposed cap on credit card interest rates and a ban on large institutional investors purchasing single-family homes.
