Consumer prices ticked up 2.7% in November

U.S. inflation picked up in November, according to the Labor Department, whose consumer price index (CPI) increased 2.7% from a year earlier, following on from a 2.6% rise in October. Core prices, which exclude volatile food and energy items, climbed 3.3% over the previous 12 months. On a monthly basis, CPI was 0.3% higher, driven by persistent inflationary pressures in the cost of food, vehicles and medical care. The cost of shelter rose 0.3% on the month and 4.7% on an annual basis. Food costs rose 0.4% monthly and 2.4% year over year, while the energy index increased 0.2% but was down 3.2% annually. Within food, the measure of cereals and bakery products fell 1.1% in November, the single biggest monthly decline in the measure’s history going back to 1989. “Overall we’re looking at an environment where the low-hanging fruit has been picked and it’s getting harder and harder to make further inroads into reining in inflation”, said Sarah House, senior economist for Wells Fargo. “Now we’re getting to a point where you really need the demand side of the economy to weaken. That’s what makes the last mile so hard”.