US consumer inflation eased slightly last month as gas prices fell

WASHINGTON (AP) — US inflation ticked down again last month, with cheaper gas helping further lighten the weight of consumer price increases in the United States.

At the same time, the latest data on consumer inflation showed that prices in some areas — services such as rents, restaurants and auto insurance — continued to rise uncomfortably fast.

Tuesday's report from the Labor Department said the consumer price index rose just 0.1 per cent from October to November. Compared with a year earlier, prices were up 3.1 per cent in November, down from a 3.2 per cent year-over-year rise in October.

But core prices, which exclude volatile food and energy costs, rose 0.3 per cent from October to November, slightly faster than the 0.2 per cent increase the previous month. Measured from a year ago, core prices rose 4 per cent, the same as in October. The Federal Reserve considers core prices to be a better guide to the future path of inflation.

The stickiness of inflation in the economy's service sector will likely keep the Federal Reserve on guard as it meets this week. Fed Chair Jerome Powell has been scrutinising such costs as a guide to whether underlying inflationary trends are cooling.

Services prices for such items as hotels, health care and entertainment are heavily determined by wages because they are labour-intensive. And wages are still rising rapidly, though they've eased from pandemic-era peaks.

Rents are also feeling inflation: They accelerated from October to November. (Real-time data from companies like Zillow and ApartmentList, though, suggest that apartment rent growth is slowing.)

Gas prices tumbled 6 percent just from October to November. From a peak of $5 about a year and a half ago, the national average has dropped to $3.15 a gallon as of Monday, according to AAA.

And grocery prices ticked up just 0.1 per cent in November and are only 1.7 per cent higher than they were a year ago. Bread, beef, chicken and pork prices all dropped.

Many goods prices, including furniture, clothing and appliances, fell last month. Used cars were an exception. Their average prices jumped 1.6 per cent in November, though they're still down nearly 4 per cent from 12 months earlier.

The mixed picture in Tuesday's inflation report will likely keep the Fed on track to leave its benchmark interest rate unchanged when its latest meeting ends Wednesday. Inflation still exceeds the Fed's 2 per cent annual target, which is why its officials are set to leave rates high. But with inflation cooling faster than expected, the Fed's policymakers likely see no cause to further raise rates, at least for now.

Follow The Gleaner on X and Instagram @JamaicaGleaner and on Facebook @GleanerJamaica. Send us a message on WhatsApp at 1-876-499-0169 or email us at onlinefeedback@gleanerjm.com or editors@gleanerjm.com.