WASHINGTON—U.S. inflation picked up last month as gas prices rose sharply, though price gains for other items were more muted.The consumer price index rose 0.4% in December from November and finished the year up 2.

Excluding the volatile food and energy categories, so-called core inflation declined to 3.2%, after remaining stuck at 3.3% for three months in a row.

U.S. producer prices rose less than expected in December as higher costs for goods were partially offset by stable services prices, suggesting inflation remained on a downward trend after progress had stalled in recent months.

US consumer inflation rose for a third straight month in December as energy prices jumped but a widely-watched measure eased slightly, raising hopes that underlying inflation may be moderating.

The Consumer Price Index ticked up by 0.4% in December, but a measure that excludes food and energy prices slowed for the first time in four months, the Labor Department said on Wednesday. Why it matters: Inflation resumed a cooling trend after a months-long interruption,