The Labor Department released the inflation report for December which showed prices were up 2.9% from a year ago, in line with economists expectations and up from 2.7% in November.

U.S. consumer prices increased slightly more than expected in December amid higher costs for energy goods, pointing to still elevated inflation that aligns with the Federal Reserve's projections for fewer interest rate cuts this year.

Inflation probably picked up in late 2024, fueled by robust household spending amid a strong economy. A key gauge of inflation — the consumer price index — is expected to show Wednesday morning that prices rose by 2.9 percent in December from a year earlier, according to economists’ forecasts of data released by the Bureau of Labor Statistics.

U.S. inflation picked up last month as prices rose for gas, eggs, and used cars, yet underlying price pressures also showed signs of easing a bit. Wednesday’s report from the Labor Department showed that the consumer price index rose 2.

The December inflation report shows that inflation rose by 0.4% month over month and 2.9% year over year. NBC News' Brian Cheung and Editor-in-Chief at Investopedia Caleb Silver break down the latest economic data.

Excluding the volatile food and energy categories, so-called core inflation declined to 3.2%, after remaining stuck at 3.3% for three months in a row.