![]() consumer inflation in December 2023 accelerated to 3.4 percent from a year ago, after dropping to 3.1 percent in the previous month, amid rising shelter and energy prices, the U.S. People shop at a supermarket in Foster City, California, the United States, Jan. ![]() December’s inflation reading is 0.6 percentage points from the central bank’s goal of 2%. The Personal Consumption Expenditures price index - the inflation gauge that the Fed uses as its target rate - was up 2.6% annually in December, closing out 2023 with a softer punch than the 5.4% gain a year prior, according to Commerce Department data released Friday. “One can’t help but be somewhat optimistic about the American economy going forward, given the fact that we are at the doorstep of price stability, and the inflation fight has essentially ended.” “The American household continues to demonstrate resilience in light of these shocks,” said Joe Brusuelas, principal and chief economist at RSM US. ![]() The last inflation snapshot of 2023 provided some further encouraging news for Americans and the Federal Reserve: This painful period of sharp price increases may be nearing its end.Ĭommerce Department data released Friday showed that although the Federal Reserve’s preferred price gauge didn’t budge from its 2.6% annual rate seen a month before, a closely watched measurement of underlying inflation dropped to its lowest level since March 2021.Īdditionally, the American household closed out 2023 on strong footing: Incomes and wages were up considerably from the year before, and consumers continued to spend heartily to keep the economy growing and casting aside recession fears.
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