Consumer prices rose 2.7 percent over the past year, according to data released Tuesday by the Bureau of Labor Statistics, with the figure dropping to 2.6 percent when excluding volatile food and energy costs. The report, the last before the Federal Reserve's meeting in two weeks, indicates that inflation remained relatively stable at the end of 2025, as the effects of tariffs implemented throughout the year influenced consumer prices.

The latest figures align with November's data, which had been affected by irregularities due to a lapse in data collection during a government shutdown. The current rate is only slightly lower than the pace observed at the beginning of 2025, before tariffs on durable goods like cars and toys, imposed by President Trump on most countries, began to take effect.

Analysts suggest the subdued inflation, coupled with a healthy unemployment rate of 4.4 percent reported in December, will likely lead Federal Reserve officials to maintain current interest rates. The Fed had previously cut interest rates three times since September.

The Consumer Price Index (CPI) was notably impacted by a 1.1 percent decrease in the cost of used cars and trucks over the month. This decline partially offset price increases in other sectors.

The Federal Reserve is scheduled to meet in two weeks to discuss monetary policy. The central bank's decisions will be influenced by the latest inflation data, as well as broader economic indicators. The meeting will provide further clarity on the direction of interest rates and the Fed's overall strategy for managing inflation and promoting economic growth.