The Bureau of Labor Statistics is set to release the December Consumer Price Index (CPI) on Thursday at 8:30 ET. With the CPI expected to have declined to 6.5%, this report would be a welcome sign for investors who hope for the Federal Reserve to curb its strict monetary policy that has resulted in the highest interest rates over the last 15 years.
Should analysts’ projections prove correct, CPI will slow down by 0.1% on a month-over-month basis. The Consumer Price Index sat at 7.5% over the month of November.
Core CPI, which excludes the volatile food and energy sections of the report, is expected to have risen at a declining rate. Having risen by 6% over November, analysts expect a 5.7% rise over the last month.
“Deconstructing inflation, core goods prices have stabilized, and shelter inflation is likely to turn in the next few months based on alternative indices,” Lazard chief market strategist Ronald Temple explained in a note to investors. “Services excluding shelter remain concerning as wages are a critical driver of price pressures.”
The results of the CPI report are expected to provide an indication of whether the Federal Reserve will choose to raise interest rates by 0.25% or 0.50% at the start of next month.