Inflation rises 0.5% in December; 7% increases over last year, highest since 1982

The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.5% in December, slightly lower than November's increase of 0.8%. However, prices have risen 7% in the last 12 months, the largest increase since 1982.

Housing and vehicles were the biggest drivers of increases in the seasonally adjusted numbers. Food prices continued to increase, but slower than in recent months.

The 7.0 percent inflation rate represents the largest increase in the CPI since June 1982. Stripping out food and energy, the CPI grew the fastest since 1991. The most significant bright spot is the energy sector which fell 0.4 percent last month, with drops in gasoline and natural gas prices.

Food and energy prices rose 0.6 percent, the sixth increase in the last nine months. In addition, housing prices, used cars and trucks, household furnishing, apparel, new vehicles, and medical care all increased in December, driving the CPI upward.

Over the last 12 months, the largest growing sectors were energy and used vehicles.

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