Fed’s Preferred Inflation Gauge Eased in November
Summary
A closely watched measure of inflation cooled notably in November, good news for the Federal Reserve as officials move toward the next phase in their fight against rapid price gains and a positive for the White House as voters face less daunting cost increases. The Personal Consumption Expenditures inflation measure, which the Fed cites when it says it aims for 2 percent inflation on average over time, climbed 2.6 percent in the year through November. Compared with the previous month, prices actually fell slightly. The report provided the latest evidence that price increases are swiftly slowing, after several months of progress that have helped to convince policymakers that they may be within sight of a soft economic landing — one in which inflation moderates without a painful recession. Fed policymakers held interest rates steady at their meeting this month, signaled that they may well be done raising interest rates, and suggested that they could even cut borrowing costs three times next year.