Inflation in December up 0.3% compared to previous month, annual increase 3.4%

The federal government's Consumer Price Index, the closely watched measure of the costs consumers in the U.S. pay for a wide range of goods and services, increased in December 0.3%, compared to the previous month, the Labor Department reported Thursday. 

Economists expect month-to-month increase to be 0.2%, according to CNBC.com.

The department's Bureau of Labor Statistic's index showed the annual increase was 3.4%. The expected increase was 3.4%.

The increases, in what is the department's final CPI report of the year, is raising questions about whether the Federal Reserve will cut interests rates, as anticipated, after several increases to try to slow high inflation.