US consumer prices in 2021 rose at the fastest pace in four decades, the government announced Wednesday, an inflation wave that has troubled President Joe Biden as the economy recovers from the pandemic.
The consumer price index (CPI) in the 12 months to December jumped seven percent, the highest since June 1982, the Labor Department said, with housing, autos and energy among the biggest contributors.
However, month-on-month CPI growth slowed to 0.5 percent from November, indicating the price surge may be nearing a peak.
The world’s largest economy saw a record price increases last year as rising demand and a return to normalcy collided with labor shortages and global supply chain snarls.
While the spike was initially confined to items like used cars and energy, the latest data confirms inflation spread in December beyond those sectors and into consumer staples.
Prices for shelter, including rental properties, were one of the main contributors to the increase, the Labor Department said, rising 4.1 percent in the year, while food rose 6.3 percent.
However, in both cases the monthly increase in the final month of the year was less than in November.
Used car prices jumped 37.3 percent in 2021, the report said, and in December prices accelerated again, rising 3.5 percent from the month prior.
With volatile food and energy prices stripped out, “core” CPI was up 5.5 percent for 2021 — the highest since February 1991, the report said.
Core CPI rose 0.6 percent for the month, faster than analysts anticipated and above its rate of growth in November.