How do inflation rates for core inflation and year-over-year 12‑month averages differ between the two terms?

1. What the two terms mean: “core” vs. “12‑month (year‑over‑year)”

“Core” is a scope — an inflation series that removes food and energy from the price index to reduce volatility; it can be expressed as a month‑over‑month change, a seasonally adjusted annualized quarterly rate, or a year‑over‑year (12‑month) percent change depending on the release format ^{[3] [5]}. “Year‑over‑year 12‑month average” refers to the percent change comparing the price index now with the same month 12 months earlier (the standard y/y CPI headline or core CPI quoted in public discussion); the Bureau of Labor Statistics and other agencies publish these 12‑month changes as the common “annual” inflation rate ^{[4] [6]}.

2. Why the numeric answers can differ: frequency, seasonal adjustment, and composition

A core monthly rate (nonannualized) or seasonally adjusted monthly movement captures recent price momentum and can show small but accelerating or decelerating signals; the Cleveland Fed notes its nowcasts report seasonally adjusted month‑over‑month rates and also quarterly SAARs, while it separately reports year‑over‑year rates based on either seasonally adjusted or nonadjusted data depending on the series ^[3]. By contrast, the 12‑month y/y rate averages twelve months and therefore mutes short spikes (for example, energy shocks that affect headline but not core) and seasonal swings that the monthly series highlight ^{[3] [4]}.

3. Evidence from recent data: core ≈ 3.0% y/y, headline near 2.7–3.0% y/y

Multiple trackers around autumn 2025 show core CPI roughly 3.0% on a 12‑month basis: Trading Economics cites core up 3.0% in September 2025 ^[2], the Treasury’s statement reports core inflation 3.0% over the 12 months through September 2025 ^[1], and USInflationCalculator/other summaries list the annual (12‑month) CPI around 3.0% for that period ^{[7] [6]}. Headline CPI year‑over‑year figures were slightly lower or similar in some reports — RBC noted headline CPI growth around 2.6–2.7% in recent months while core hovered nearer 3.3% in one month, illustrating how headline and core can diverge month to month ^[8].

4. How policymakers and analysts use each measure differently

Central banks and researchers focus on core to judge underlying inflation trends because food and energy are volatile; the IMF and CEPR analyses stress that core remaining above target suggests persistent underlying pressures requiring policy attention ^{[9] [10]}. But policymakers also watch the 12‑month headline because it captures the lived experience of consumers and can influence expectations; Treasury commentary compares 12‑month PCE and CPI differences to highlight how choice of index moves reported annual rates ^[1].

5. Common pitfalls and potential misinformation to watch for

Statements that conflate “core” with “12‑month average” are misleading: core is a category, while “12‑month” is a timing convention — you can have a 12‑month core rate or a 12‑month headline rate ^[3]. Also, month‑to‑month jumps in seasonally adjusted core figures can be amplified in headlines if reporters ignore that annualized or seasonally adjusted formats differ; the BLS explains seasonal adjustments and revisions that affect short‑run comparisons ^[4].

6. Bottom line for readers: what numbers tell you and what they don’t

If you want to know whether inflation’s underlying trend is cooling, watch the 12‑month core series (currently around 3.0% through September 2025 per Treasury and data aggregators) alongside monthly or SAAR core movements for turning points ^{[1] [2] [3]}. Available sources do not mention a single, universal definition that always maps “core” to one temporal framing — analysts choose the time window (monthly, quarterly SAAR, or 12‑month) to answer different questions ^{[3] [4]}.