WASHINGTON (AP) 鈥� An inflation gauge that is closely watched by the Federal Reserve barely rose last month in a sign that price pressures cooled after two months of sharp gains.
Friday鈥檚 report from the government showed that prices rose just 0.1% from October to November. Excluding the volatile food and energy categories, prices also ticked up just 0.1%, after two months of outsize 0.3% gains.
The milder inflation figures arrived two days after Federal Reserve officials, led by Chair Jerome Powell, rocked financial markets by revealing that they now expect to in 2025, down from four in their previous estimate. Stickier inflation, Powell said, 鈥渕ight be the single biggest factor鈥� causing the central bank to reduce the number of rate cuts it envisions. Fewer Fed rate cuts would likely mean that mortgage rates and other consumer borrowing costs would remain elevated.
Yearly inflation was 2.4% in November, up from 2.3% in October and above the Fed鈥檚 2% inflation target. Year-over-year 鈥渃ore鈥� prices, which exclude volatile food and energy costs, were unchanged at 2.8%.
Inflation, according to the measure released Friday 鈥� the personal consumption expenditures price index 鈥� has plummeted from a peak of 7.2% in June 2022 to 2.1% in September. The Fed's tool for fighting inflation is to steadily raise borrowing costs across the economy, which tends to cool spending and growth.
Christopher Rugaber, The Associated Press
