Prices for everyday household necessities climbed in December compared with the previous month, even as overall inflation remained steady. The trend highlights uneven price pressures across income groups, with lower-income households bearing the greatest strain.

Economists welcomed signs of stabilization in the latest government inflation report released Tuesday, pointing to easing “core” inflation — which excludes food and energy due to their volatility. However, those excluded categories continued to show persistent price increases, directly affecting basic living costs.

Grocery prices rose broadly in December, with increases recorded across five major food categories. Dining out also became more expensive. Utility bills added further pressure, as electricity prices climbed nearly 7% over the past year and natural gas prices posted double-digit gains.

Health care costs, which had seen relatively slow growth in recent years, are now contributing more significantly to inflation, according to Bureau of Labor Statistics data. Meanwhile, tariff-related cost pressures have not yet fully appeared in retail prices for imported goods such as clothing and footwear.

Some categories offered modest relief. Gas prices declined in December, one of the few noticeable price drops for consumers. Used vehicles, communication services, and household services also recorded month-to-month price decreases, partially offsetting broader increases.

Still, analysts caution that inflation in essential goods remains stubborn. “Price pressure is edging higher across key consumer product categories that matter most to households,” said Rob Holston, head of consumer products at EY Global.

Persistent inflation in necessities is also deepening financial inequality, reinforcing what economists describe as a “K-shaped” economy — where higher-income households, buoyed by strong stock markets and rising home values, continue spending comfortably, while lower-income families struggle to afford basic expenses and cut back on discretionary purchases.

Data from Bank of America shows the top 5% of earners drove most spending growth through late 2025, particularly on travel, dining, and online shopping. Meanwhile, lower-income consumers reduced spending on nonessential items such as vacations, entertainment, and furniture.

“The K-shaped divide is here to stay,” Bank of America economists wrote in a client note Monday.