2023-12-22 20:22:57
Bank of America brands in New York. Behar Anthony/Behar Anthony/SPUS/ABACA
ANALYSIS – The decline in inflation is confirmed, at 2.6% over one year. The United States will have escaped recession in 2023.
Multiple signs of easing inflation in the United States paradoxically place the Federal Reserve in an embarrassment. The American central bank does not want to declare victory too soon. At the same time, the markets no longer believe the message of necessary maintenance of its key rate, known as “fed funds”, between 5.25% and 5.50%.
The last important inflation statistic of the year came on Friday. It confirms the most optimistic expectations. The price index for personal consumption expenditures (PCE) in November fell by 0.1%. Without accounting for volatile energy and food prices, this measure of inflation, which is the Fed’s favorite, reflects a gain of just 0.1%. In both cases, the trend is better than expected. Over the last twelve months, inflation measured by the PCE index is therefore only 2.6%. The Fed’s objective, of around 2%, is close.
Also read: The astonishing strength of the American economy
Since mid-October, investors have been betting exactly…
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