Inflation rate ticked up to 3.4% in December as Fed eyes pivot

Inflation ticked up to 3.4% for the year ending in December, an unwelcome development as the Federal Reserve grapples to contain prices.

The data that were reported on Thursday by the Bureau of Labor Statistics in an update to the consumer price index is a bit of bad news for President Joe Biden. The White House has tried to tout reports that show inflation falling, alongside the country’s strong labor market, as “Bidenomics” at work.

It is also unwelcome news for the Fed, which has worked to drive down inflation since March 2022 by hiking interest rates as part of its historic tightening cycle. The increase might raise questions about whether the central bank will truly begin to pivot to cutting soon and might cause some anxiety among investors.

On a month-to-month basis, inflation rose 0.3%, more than expected.

“Core inflation,” which doesn’t include volatile food and energy prices, fell
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