News You Need To Know on Jan. 12, 2023

Let’s breathe all relief: Inflation is relaxing.

Today’s Consumer Price Index (CPI) report really experienced deflation to the US economy last month, as prices fell 0.1% after an increase of 0.1% in November. In November, the annual rate of inflation cools down to 6.5% in November and to suit economists’ estimates.

The rapid decrease in gas prices was the biggest reason for the previous month’s decline, which offers high costs for food and housing. The “core” rate of inflation, which excludes the cost of food and energy, increased by 0.3% and 5.7% year-over year, less than the 6% annual rate of November. Those figures were also in line with economist estimates.

The news should inject optimism for investors and shopkeepers who are concerned about the impact of rising costs on the US economy and can take decisions as a result of the Federal Reserve. Anyone who is struggling as high prices, has purchased a financial pain for grocery items and other items, today’s data shows that the rate of Fed is doing its work.

Investors also have a reason to be happy as the cooling inflation environment may increase the low aggressive interest rate at a higher speed. The Central Bank is ready to discontinue its first policy meeting of the year at the end of the month, and with inflation slowing, investors are predicting that the Fed will only increase the rate of 25 basis points.

But since the fed is unlikely to prevent the rates from raising the rates completely, the stocks were flat and mixed on the news. It is important to remember that inflation is still much above the target of 2%of the fed. Policy makers have made it clear that they will not give up until inflation falls in line with that figure. Till then, we can all rejoice that our wallets will not meet anymore.