December 8, 2022

The US CPI came in at 2.6% lower than expectations, dropping to a 7.7% annualized rate in September. This falls short of the 8.1% inflation target the Fed had been targeting. The main driver of the drop in inflation was lower energy prices, which offset rises in food and apparel prices. Core CPI, which excludes food and energy, also came in at a 0.2% lower rate than expectations. The Fed has raised interest rates twice this year, and is expected to do so again in December, in order to keep inflation under control.

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