Economic Report: Inflation is slowing, CPI to show, but it’s still a big problem

by | Dec 12, 2022 | Stock Market

The high rate of U.S. inflation probably slowed again in November, but not enough to ease worries at the Federal Reserve or prevent the central bank from raising interest rates even higher to slow the economy. Here’s what to watch in the consumer price index on Tuesday morning.

The forecast The consumer price index is expected to rise a mild 0.2% last month, helped by the falling cost of gasoline, according to economists polled by The Wall Street Journal. Gas prices have tumbled since the summer, reversing a big spike last spring that sent inflation to a 40-year high. As a result, the cost of living has risen more slowly in the past four months. If the forecast is spot on, the annual rate of inflation would taper off to 7.3% from 7.7% in October and a peak of 9.1% in June.‘Core’ inflation The increase in consumer prices, excluding food and gas, is forecast to rise a sharper 0.4% in November. This is what is known as the core rate of inflation. Such an increase would not be as fast as last spring or summer, but it would still more than double the size of the monthly gains that were the norm before the pandemic. Wall Street and the Fed pay especially close attention to the core rate since they view it as a harbinger of future price trends. The yearly rate of core inflation might fall a few ticks to 6. …

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