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Published: Jan 12, 2023
Updated: Jan 12, 2023

US Inflation Slows in December, Meeting Expectations

The US Bureau of Labor Statistics has released its December inflation data, showing that consumer prices likely slowed for a sixth straight month. According to the data, the Consumer Price Index (CPI) was at 6.5% YoY, in line with expectations and a decrease from the 7.1% YoY seen in November. The decrease is likely due to lower energy prices.

Core Inflation:

Core inflation, which excludes food and energy prices, also fell to 5.7% YoY, the lowest in a year. This is also in line with expectations. The data supports the Federal Reserve's assertion that the recent rise in inflation has been transitory and that prices should moderate over time.

Lower Energy Prices:

The decrease in overall inflation can be attributed to lower energy prices. The energy index fell in December, following a rise in November. Despite the decrease, overall energy prices are still up YoY.

Federal Reserve's Outlook:

The Federal Reserve has stated that it expects inflation to moderate over time, as it is likely to be transitory. The Fed will closely monitor the situation to ensure that prices don't fall too low and that the economy continues to recover.

Data meets estimates exactly:

In conclusion, US inflation slowed in December, meeting market expectations. The decrease in overall inflation can be attributed to lower energy prices. Core inflation also fell to 5.7% YoY, the lowest in a year. The Federal Reserve expects inflation to moderate over time, and will closely monitor the situation to ensure that prices don't fall too low and that the economy continues to recover.

US Markets opens positive:

The stock market began positively following the release of the December consumer prices report, which met predictions of economists and indicated that inflation was continuing to decrease. The Dow Jones Industrial Average experienced an increase of 99 points, or 0.3%. The S&P 500 also saw a rise of 0.3%, while the Nasdaq Composite remained relatively unchanged