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Rising rents, higher gas prices and increasingly expensive medical care pushed inflation up in 2016, marking the fastest growth in five years.
Late summer gains helped drive inflation up 2.1% over the course of the year, and the consumer price index rose 0.3% in December, MarketWatch reports. Despite the largest fall in grocery prices since the end of the Great Recession, housing costs, doctor visits and gas prices rose enough to more than make up the difference.
The jump in inflation means real wages limped up a mere 0.8% last year, and only 0.5% for workers not in management roles. If inflation doesn’t slow, and most experts don’t think it will anytime soon, the Fed may raise interest rates sooner than expected this year. [MW]
