Fed's preferred inflation gauge shows price increases fell in November but still remain sticky
Published On Dec 20, 2024, 8:35 AM
The Federal Reserve's preferred inflation measure revealed that while month-over-month price increases in November decreased, inflation remains persistent. The core PCE index rose 0.1% in November, down from 0.3% in October and below expectations of a 0.2% increase. Yearly core prices remained stable at 2.8%, matching October's rate but underperforming Wall Street expectations of 2.9%. Overall PCE increased by 2.4% annually, slightly more than anticipated. The Fed is expected to implement fewer interest rate cuts in 2025 and sees core inflation peaking at 2.5%, indicating ongoing challenges in reaching the annual 2% inflation target.
Stock Forecasts
SPY
Positive
The inflation readings, along with the slow pace of interest rate cuts, could lead to continued market uncertainty. Investors might respond by favoring growth sectors that could benefit from stable economic growth rather than riskier assets in a volatile market.
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