(C) Common Dreams
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Inflation Is Slowing, Good News for American Consumers and the Fed [1]
['Jeanna Smialek']
Date: 2023-01-12
Inflation slowed on an annual basis for a sixth straight month in December, a relief for households and an encouraging signal for the Federal Reserve and the White House that the worst of America’s pandemic-induced inflation burst may be in the past.
The Consumer Price Index climbed 6.5 percent in the year through last month, down from 7.1 percent in the November reading, as prices declined on a monthly basis for the first time in more than two years. The annual inflation rate was the slowest since October 2021, a pullback driven by falling gas prices and cheaper airfares.
Economists and Fed officials are more acutely focused on a so-called core inflation measure, which removes food and fuel prices to get a sense of underlying price trends. That measure ticked up on a monthly basis, but the yearly measure slowed to 5.7 percent in December from 6 percent previously.
Altogether, the data provided the latest evidence that inflation is moderating meaningfully, bringing consumers relief as they try to purchase a used vehicle, take a road trip or buy new furniture. But price increases are still unusually fast across a number of goods and services, from food to car maintenance, and the key question now is how quickly and completely inflation will return to prepandemic levels of around 2 percent after a year and a half of rapid increases.
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[1] Url:
https://www.nytimes.com/live/2023/01/12/business/december-cpi-inflation-report/inflation-gas-discounts?smid=url-share
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