December Inflation Data Meets Economist Expectations

December 2026 CPI came in at 2.7% year-over-year on January 14, matching November’s reading and meeting economist expectations as Federal Reserve prepares for policy meeting. The December 2026 CPI report showed prices edging up 0.3% for the month, consistent with forecasts as policymakers evaluate the trajectory of inflation and monetary policy. Core December 2026 CPI, which excludes volatile food and energy components, registered 2.6% annually, slightly below consensus projections of 2.8% annual increase for this key metric. The cooler-than-expected core December 2026 CPI data strengthened market expectations that the Federal Reserve may have room to cut interest rates at least twice during the year. Treasury yields declined following the December 2026 CPI release, with the 10-year yield slipping below 4.18% from 4.20% as bond traders adjusted their positions based on data. The December 2026 CPI report arrives as Fed policymakers are widely expected to pause rate cuts at their January 27-28 meeting after recent labor market stabilization. (119 words)