Kiplinger's latest forecast on inflation iStockphoto By David Payne, Staff Economist December 12, 2018 GDP Unemployment Interest Rates Inflation Business Spending Energy Housing Retail Sales Trade Deficit GDP Third-quarter growth a solid 3.5%, but slowdown is coming More » Jobs Unemployment rate will decline further in '19 More » Interest rates 10-year T-notes at 3.6% by end ’19 More » Inflation 2.3% in ’19, the same as in ’18 More » Business spending Up 7% in ’18, boosted by expanded tax breaks More » Energy Crude trading from $65 to $70 per barrel in March More » Housing 5.46 million existing-home sales in '18, down 1.5% More » Retail sales Growing at least 4% in ’19 (excluding gas and autos) More » Trade deficit Widening 7%-8% in ’19 More » The inflation rate for 2019 will be the same as for 2018, 2.3%. Factors pushing prices up faster include tariffs and labor. But cheaper gasoline, food and housing will balance out those forces. The Federal Reserve won’t have to speed up or slow down its interest rate hikes as a result. It will keep raising rates a quarter of a point every three months: December 19, and in March and June of 2019, to reach its goal of getting the federal funds interest rate to 3%. November gasoline prices more than reversed their October surge, leaving the total inflation index unchanged from October. However, the “core” rate — all prices except food and energy — picked up to a 2.2% yearly rate. This rate will likely edge up to 2.3% by the end of 2019 as the economic expansion generates small inflationary pressures. Advertisement via e-mail: Kiplinger Alerts — Intelligence for your business success Shelter costs will end 2018 up 3.1% and are expected to rise at a slightly slower pace in 2019; food gains will run a slightly slower 1.2% next year; prices of all other commodities will rise a slight amount in 2019; and the cost of medical care services will increase by 2.4% next year, from 2.1% now. Physicians’ services and prescription drug prices have been lower than expected for a while but should start gaining. Hospital visits will keep getting more expensive, at a rate faster than overall inflation. Other services will be 3% more expensive in 2019, up from 2018’s 2.7% rate. SEE ALSO: Print-Ready Consumer Price Index Chart Source: Department of Labor, Inflation Data