The 1.4% means that the CPI in December 2020 (260.474) was 1.4% higher than what it was in December 2019 (258.811).
The 260.474 means that what cost $100 in 1982 cost $260.47 in December 2020.
Now the CPI can go up and down during the course of the year and the Bureau of Labor Statistics calculates it for every month. So if it increased every month but then fell quite a bit in December, it might not look like there was much inflation.
They also calculate an average CPI over the twelve months and then compare that to the one for the previous year. That inflation rate for 2020 was 1.2%. Those two figures are usually pretty close to each other, but not always.
In 2008, the Dec.-Dec. method gives a 0.1% inflation rate while the monthly averaging method was 3.8%. In 2009, those numbers were 2.7% and -0.4%. So they can be pretty far apart.
To see this data (actually going back to 2013), go to Consumer Price Index Data from 1913 to 2021.
See also Prices, and Confusion, Set to Rise as Pandemic Fades: Price gains remain muted, but only because services demand is still depressed by the Covid-19 crisis by Justin Lahart of The WSJ. Excerpts:
"The things that have kept inflation low during the Covid-19 crisis are a lot different than the ones that used to keep it low. A whipsawing of prices when the pandemic passes is something to look out for.
The Labor Department on Wednesday reported that U.S. consumer prices rose 0.4% in December from November, putting them 1.4% above their year earlier level. Core prices, which exclude food and energy items to better capture inflation’s trend, rose 0.1% from November, and were up 1.6% on the year.
The Federal Reserve’s aim is for 2% inflation, and the consumer price measures it follows run cooler than the Labor Department’s.
Under inflation’s hood, though, there are some big shifts. Prices for food at home—groceries and the like—remain elevated as a result of the pandemic, and were up 3.9% in December from a year earlier. Meanwhile, prices for lodging at hotels and the like were down 11.2%."
"Core goods prices were up 1.7% on the year last month" (excluding food and energy)
"Core services prices were up 1.6%"