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HomeLatest NewsInflation eases in the United States and stands at 5% during December

Inflation eases in the United States and stands at 5% during December

Date: April 2, 2023 Time: 09:39:57

The Federal Reserve (Fed) chose the US Personal Consumption Expenditure Price Index to monitor inflation. This indicator indicates that prices grew by 5.0% in year-on-year terms during the month of December, showing a moderation of half a point with respect to the month of November, as reported by the Government’s Office of Economic Analysis.

The underlying index, which excludes its calculation of food and energy prices due to their greater volatility, closed the last month of 2022 with an increase of 4.4%, three tenths less than the previous month. In monthly rates, the general variable of the index experienced an increase of 0.1%, the same as in November, while the underlying variable rose one tenth to 0.3%.

The high levels of inflation due to the ‘post-covid’ macroeconomic conditions and the war in Ukraine have negatively affected GDP growth. To counter rising prices, the Federal Reserve raised interest rates by a half point to a range of 4.25% to 4.5% last December. The next revision of this figure will be announced on February 1, the day the Fed officials will meet again. In addition, this Thursday it is assumed that the world’s leading economy grew by 0.7% in the fourth quarter of 2022, one tenth less than in the previous quarter. In the year as a whole it increased by 2.1%.

Likewise, the Fed has advanced that during the next few weeks it will have to make a decision of great importance since the central bank could increase its rates by 25 basis points, events that would slow down its growth to actively damage inflation.

These falls suggest that the economy will suffer a lot in the future, so that the recession is an increasingly justified fear. Likewise, the Fed’s total assets are down 5.3% from the highs recorded last year, although the balance is still above the records of 2020 before the pandemic broke out.

Puck Henry
Puck Henry
Puck Henry is an editor for ePrimefeed covering all types of news.

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