The Globe and Mail reports in its Thursday edition that while the U.S. CPI inflation report on Tuesday showed a slightly softer-than-expected annual increase in core prices, there is little reason for consumers or policy-makers to cheer. A Reuters dispatch to The Globe reports that the sharp rise in food prices highlights the ongoing affordability crisis for consumers. The Consumer Price Index rose 2.7 per cent annually in December, while core prices, excluding food and energy, increased by 2.6 per cent, below forecasts. Food prices rose by 0.7 per cent last month, the largest increase since October, 2022, bringing the annual food inflation rate to 3.1 per cent. This comes just as oil prices have been starting to pick up again. Fed officials prefer to focus on core inflation, excluding food and energy prices, but consumers, with lower incomes, cannot avoid these costs. Economists point out that the "wedge" between monthly CPI and PCE inflation is widening. Economists at Barclays and Morgan Stanley raised their December PCE forecasts to nearly 0.5 per cent, pushing the annual rate to 2.8 to 2.9 per cent. BNP Paribas's Andy Schneider noted that December's PCE inflation will be "significantly" higher than CPI.