Is the US economy improving?
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(CNN) --
The Federal Reserve's (Fed) preferred inflation gauge showed prices rose at a slower pace in December, signaling further progress in the central bank's battle with higher prices.
The Personal Consumption Expenditures, or PCE, price index rose 5% year-on-year in December, the Commerce Department reported Thursday.
In December alone, prices rose 0.1% from November.
The US economy grew 2.9% in the fourth quarter, more than expected
Core PCE, which excludes the more volatile food and energy categories, rose 4.4% annually, down from November's annual rate of 4.7%.
On a monthly basis, it was up 0.3%.
The core PCE is the Fed's favorite inflation gauge, as it provides a more complete picture of consumer costs and spending.
Inflation