DECEMBER 16, 2024 – INFLATION RISES TO 2.7 PERCENT IN NOVEMBER
The November inflation rate edged up slightly, 0.3 percent for the month or 2.7 percent for the year, in line with expectations. For comparison, month-over-month inflation has come in at 0.2 percent for each of the last four months. Core inflation rose 0.3 percent fo the month, while year-over-year core inflation held at 3.3 percent.
Inflation seems to be trending toward the Fed’s 2 percent target, but not in a linear fashion. Fed Governor Christopher Waller said last week he thinks inflation may be “stalling.” Despite the slight uptick, the data is not expected to derail the third consecutive rate cut at the Fed’s meeting later this week. The Fed is expected to drop rates by 25 basis points to bring interest rates into a range of 4.25 to 4.50 percent.
Seeing inflation has remained stubborn and there have been signs of a softening labor market, there have been predictions the Fed will slow its pace of rate cuts in 2025 to a quarterly pace. This would bring rates down to about 3.5 percent by the end of next year.