Here's the inflation breakdown for December 2024 — in one chart
Published On Jan 15, 2025, 10:46 AM
In December 2024, the inflation rate rose to 2.9% year-on-year, up from 2.7% in November. Major contributors to this rise include increases in energy, food, car prices, and airline fares. While inflation is trending upwards, economists anticipate a return to downward trends in 2025, contingent upon economic policies under President-elect Trump, particularly tariffs that could exacerbate inflation. Despite the uptick, core inflation, excluding food and energy, showed signs of cooling, dropping to 3.2%. Goods such as eggs, impacted by bird flu, saw notable price spikes. Overall, the Federal Reserve targets a long-term inflation rate of around 2%.
Stock Forecasts
SPY
Negative
Given the recent inflation data and potential economic policy changes under the new administration, inflation may hinder overall economic growth, causing market volatility. However, the cooling core inflation indicates a potential easing of pressure on consumers and businesses. Consequently, sectors sensitive to inflation, such as transportation (airline fares), may struggle amidst rising costs.
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