The prices of goods and services increased in the United States in November by one tenth compared to October, and in total they grew by 7.1% in relation to the same month last year, according to data published this Tuesday by the Department of Labor.
Although this figure is still historically high, it represents a slowdown compared to October (7.7%), and it is
better
than expected by the experts (7.3%), which suggests that inflation may be moderating at last.
The Federal Reserve plans to raise interest rates again this week to alleviate the rise in prices, but the figure released this Tuesday could reinforce the idea that the rise is limited to 50 basis points, instead of 75 in previous months.
Core inflation, which excludes food and energy costs, rose 6% in the past year and two tenths from the previous month, compared to the respective estimates of 6.1% and three.
Although inflation remains very high, it is well below the recent peak of 9.1% reached in June and marks the fifth consecutive year-on-year slowdown.
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There are encouraging signs that the economy is improving.
Gasoline prices are down from their mid-summer highs and are lower than a year ago.
Many supply chains have been unlocked, helping to reduce the costs of imported goods and parts.
The prices of wood, copper, wheat and other raw materials have also fallen.
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The Federal Reserve and economists will now focus more on month-on-month inflation numbers to see where prices are headed.
On a month-on-month basis, inflation soared 1% in May and 1.3% in June, but has risen only 0.2% on average over the past four months.
In any case, it remains well above the 2% target set by the Federal Reserve as year-on-year growth, a figure that may not reach at least until 2024.
Federal Reserve Chairman Jerome Powell has said he is tracking price developments in three different categories to better understand the likely path of inflation: goods, which excludes the volatile costs of food and energy;
housing, which includes rents and the cost of home ownership;
and services that do not include housing, such as auto insurance, pet services, and education.
In a speech in Washington two weeks ago, Powell noted that some progress had been made in moderating inflation for goods and housing, but not for most services.
Physical goods such as used cars, furniture, clothing, and appliances have become cheaper since the summer.
