The Consumer Price Index decreased by -0.1% for December as energy prices declined.  Gasoline alone decreased -3.9% for the month.  Inflation without food or energy prices considered increased 0.1% for the month.  From a year ago overall CPI has increased 0.7%, which is very tame and the second slowest rate in 50 years.  Without energy and food considered, prices have increased 2.1% for the year.   CPI measures inflation, or price increases.

The flat yearly overall inflation is shown in the below graph, driven by low energy prices.

Core inflation, or CPI with all food and energy items removed from the index, has increased 2.1% for the last year.  This is the highest annual core inflation increase since July 2012.  For the past decade the annualized inflation rate has been 1.9%.  What this shows is other things like homes and rents have increased dramatically and are countering out the break cheap gasoline is giving consumers.

Core CPI's monthly percentage change is graphed below.  This month core inflation increased 0.1%.  Within core inflation, shelter increased 0.2%.  Apparel prices dropped -0.2%, used cars increased 0.1%, transportation services increased 0.2% and airfare dropped -1.1% for the month.  Auto insurance increased 0.5% for the month and increased 1.1% the previous.

The energy index is down -12.6% from a year ago.   The BLS separates out all energy costs and puts them together into one index.  For the year, gasoline has declined -19.7%, while Fuel oil has dropped -31.4%.  Fuel oil dropped -7.8 % for the month alone.  Graphed below is the overall CPI energy index.

Graphed below is the CPI gasoline index only as gas-guzzlers rejoice.

Core inflation's components include shelter, transportation, medical care and anything that is not food or energy.  The shelter index is comprised of rent, the equivalent cost of owning a home, hotels and motels.   Shelter increased 0.2% and is up 3.2% for the year.  Rent just keeps increasing and this month by 0.2% and is up 3.7% for the year.  Graphed below is the rent price index.

Food prices decreased -0.2% for the month.  Food and beverages have now increased just 0.8% from a year ago.  Groceries, (called food at home by BLS), plunged -0.5% for the month, and are down -0.4% for the year.  The reason was the meats, poultry, fish, and eggs index declined by -1.4%.  This is the largest decrease since August 1979.  The beef index
fell by -2.4% and eggs dropped by -3.4%.   Eating out, or food away from home increased 0.1% for the month and is up 2.6% for the year.

Graphed below are groceries, otherwise known as the food at home index.

Medical care services were up 0.1% for the month and have increased 2.9% for the year.  Graphed below is the overall medical care index, which increased 0.1% for the month and is up 2.6% from a year ago.

Below is a graph of the medical commodities index, which is mostly prescription drug prices.  Medical commodities decreased by -0.1% for the month and is up 1.5% for the past year.

Real hourly earnings increased by 0.1% for all employees.  Real means wages adjusted for inflation and since CPI decreased by -0.1% and wages had no change.  For the year real hourly earnings have increased 1.8%, clearly not staying ahead of the inflation game.  The average real hourly wage is now $10.61.  Weekly real earnings increased 0.1% for the month.  Real weekly earnings now stand at $366.11.  Hours worked did not change for the month.  There is a separate category for production and nonsupervisory employees and their real hourly earnings increased 0.3%.

Overall housing is the real cost for most people and wages are not keeping up with soaring costs.

CPI details

The DOL/BLS does take yearly surveys on where the money goes in the monthly budget, but as one can see, food and energy are significant amounts of the monthly finances.  Run away costs in these two areas can break the bank, so can food.  Additionally CPI uses substitution, so if flour goes through the roof, somehow we're all just fine with oats and prices didn't really overall increase much. Here is the BLS CPI site, where one can find much more details, information on calculation methods and error margins.

Other CPI report overviews, unrevised, although most graphs are updated, are here.   If you're wondering why the graphs display different figures from the text, the graphs calculate percentages from the index and do not round.  The actual data from the BLS report does round to one decimal place. In other words, 0.05% is rounded to 0.1%.