Jan 12 (Reuters) – Federal Reserve policymakers on Thursday expressed relief that inflation continued easing in December, paving the way for a possible step down to a quarter point interest rate increase when the U.S. central bank meets in just under three weeks. U.S. consumer prices fell in December in the first month-to-month decline in more than 2-1/2 years, and underlying inflation slowed, government data showed on Thursday. In the 12 months through December, the so-called core CPI increased 5.7%, the smallest gain since December 2021 and fresh evidence the Fed’s aggressive rate increases are having the desired effect. “We are in fact constraining the economy and presumably in the process constraining inflation. That means for me I can be a little more nuanced,” in deciding the size of upcoming rate increases, Richmond Federal Reserve president Tom Barkin said in comments to reporters in Richmond. After raising rates by half a point at its December meeting, Barkin said he was “in concept supportive of a path that is slower but longer and potentially higher” depending on how inflation behaves. “Hikes of 25 basis points will be appropriate going forward,” Philadelphia Fed president Patrick Harker said in a speech to a local group in Malvern, Pennsylvania, adding that once rates get just above 5%, “I expect that…will be restrictive enough that we will hold rates in place to let monetary policy do its work.” NN: Stupidity. Inflation has not “moderate” its still zooming ahead at 6.5% year over year. An the FED is not Not NOT done raising interest rates. Its going to raise them slower for longer. This is notNotNot good news for the markets or the economy. Because this means a longer sharper recession… Let them have their WallStreet circle jerk… Next stop for starters is a 25% plunge in the stock market. Then things will really get going. The street wants you to believe that the stock market will have a big rally. As they baton down the hatches, preparing for the coming depression… Look at the chart below titled. US inflation shows signs of slowing… its rate of growth…..The Critical core PCE and core CPI have leveled off…… they are flat lining at above 5%. They have to drop to 2% before the Fed is done….. And that my friend is a long way to go!
