February 20, 2026 01:48 PM EST

The Fed’s Favorite Measure Of Inflation Was Hotter Than Expected at the End of 2025

FROM 16 minutes ago

After a turbulent year, the Federal Reserve’s favorite measure of inflation ended 2025 higher than where it began.

Consumer prices as measured by Personal Consumption Expenditures rose 2.9% over 12 months in December, up from a 2.8% annual increase in November and reaching the highest since March 2024, the Bureau of Economic Analysis said Friday. That was higher than the 2.8% annual inflation rate forecasters had expected according to a survey of economists by Dow Jones Newswires and The Wall Street Journal. “Core” prices excluding the volatile food and energy categories rose 3% over 12 months,…