US CPI/PPI - 2026-01-12

Core came in significantly cooler than consensus, headline at consensus. Nevertheless, generally December CPI was a little hotter than November. Powell's "supercore" came in at 2.77% at an annual rate in December, just slightly above his target at 2.5% -- and that excludes housing, eliminating any distortions from that. Our simpler core ex-OER came in under target at just 2.11%. The worst large category was food (which is why core, which excludes it, looks better than headline). Within food, restaurants were the worst part. Natural gas utilities was the fourth-worst micro-segment. Both those cut against Trump's born-again focus on "affordability." Oh, and speaking of Trump -- the worst inflation in the whole world now is (wait for it...  wait for it... ) Iran! Who needs tariffs?