Consumers got a bit of relief in December as prices were pushed down amid a steep decline in gasoline prices and deeper-than-typical holiday discounts.
The Consumer Price Index (CPI) turned negative in December, falling one-tenth of a percentage point from the previous month, the Department of Labor said. Gasoline prices were the biggest contributor to the decline, falling 9.4 percent compared with November. Compared with a year ago, gasoline prices are down 1.5 percent.
Despite the December downturn, prices are still up compared with a year ago. The CPI is up 6.5 percent.
Food prices are still rising at a brisk pace. Grocery store prices were up 0.2 percent compared with November and 11.8 percent year-over-year. Prices at restaurants rose 0.4 percent compared with November and were up 8.3 percent for the year.
Core CPI, which excludes food and energy prices, rose 0.3 percent for the month. Core prices were up 5.7 percent compared with a year ago.
Prices of goods excluding food and energy fell 0.3 percent in December and are up just 2.1 percent compared with 12 months earlier. Prices of goods excluding food, energy, and used cars ticked up 0.1 percent month-to-month were up 4.7 percent annually.
Services prices rose 0.6 percent month-to-month. They were up 7.5 percent compared with a year earlier. Prices of core services—a measure that excludes energy services—rose 0.5 percent and were up seven percent compared with a year ago.
Excluding food, energy, and shelter prices—a metric several Fed officials have said is key to evaluating price stability—prices by one-tenth of a percentage point in December. Compared with a year earlier, this measure is up 4.4 percent.