Photo (c) J.L. Gutierrez - Getty Images
The Labor Department’s Consumer Price Index (CPI) fell 0.1% in December, pulling the annual inflation rate down to 6.5%. The reading was exactly in line with economists’ estimates.
For consumers who have already trimmed spending to focus on the bare necessities, the report was a mixed bag. Gasoline prices continued their decline, falling 9.4% from November. Compared to December 2021, gas prices were 1.2% lower last month, though they have begun to rise again this month.
Consumers also continued to pay less for used cars and trucks in December. After rising to record highs earlier in the year, used vehicle prices were 2.5% lower last month. Over the last 12 months, prices are down 8.8%.
But those breaks for consumers were offset by continued price increases at the supermarket. The price of food prepared at home rose another 0.2% last month and is up 11.8% over the last 12 months.
Breaking down food costs
Breaking down food categories, three of the six major grocery store food group indexes increased over the month. The cost of meats, poultry, fish, and eggs increased by 1%. Eggs alone were up 11.1%.
In contrast, fruits and vegetables were noticeably cheaper, with prices falling 0.6%. Fresh fruit alone fell 1.9%.
The index for dairy and related products decreased by 0.3% in December and the index for cereals and bakery products was unchanged.
Food consumed away from home increased in price even more, gaining 0.4%. Restaurant prices are up 8.3% over the last 12 months.
The cost of shelter also continued its rise. Rent and other homeownership costs jumped 0.8% in December, on top of a 0.6% increase in November. Year-over-year, shelter costs were up 7.5% in December.
Other categories also contributed to consumer pain last month. Despite all those December holiday price cuts on clothing, apparel costs were up 0.5% last month – 2.9% over the last 12 months.