US inflation accelerates in December

Underlying US consumer prices registered the biggest gain in December, raising the outlook for the Federal Reserve to hike interest rates more quickly in 2018.

The core inflation, which excludes volatile food and energy prices, increased 0.3 percent in December, its largest increase since January 2017, said the Labor Department on Friday.

"Along with the shelter index, the indexes for medical care, used cars and trucks, new vehicles, and motor vehicle insurance were among those that increased in December. The indexes for apparel, airline fares, and tobacco all declined over the month," said the Labor Department.

The core inflation rose 1.8 percent for the 12-month ending December. With tightening labor market, rising commodity prices, a weak dollar, and tax cuts stimulus, the inflation index has been heading towards the Fed's two percent target.

The US central bank raised interest rates three times in 2017 and forecast three rate increases in 2018.

(ASIA PACIFIC DAILY)