US Inflation (CPI) - Getting Better

Written by Philip Rich, Chief Investment Officer,  December 14, 2022.

The “all items” CPI index came in at 7.1% (YOY) for November, down from a high of 9.1% in June. This broad measure of inflation has declined for the past five months. The improvement would have been even stronger had it not been for a meaningful increase in “shelter,” i.e., housing. Energy and other commodities led the way to a lower rate of inflation. Used vehicles were down sharply. After rising much of this year, gasoline has declined to a level just below where it was at the beginning of the year. Heating oil remains high. Food continues to contribute to household inflation, albeit at a slower rate. “Core” inflation (less food & energy) was up 6% (YOY), marking a second month of decline. Core inflation has been running at 4.3% over the last three months. These numbers could give the Fed cover for a slower pace of interest rate increases. Inflation is still well above the Fed’s target, but it is moving in the right direction.

US Inflation - Still Too High

  • 7.1% YOY for “all items,” the smallest 12-month increase in a year

  • “Core” inflation went up to 6.0% YOY; 4.3% for the last 3 months

  • Food and housing remain strong drivers of higher prices

  • Lower energy costs helped, especially gasoline

  • Markets reacted positively to the news

  • Report could set the stage for a slower pace of rate increases from the Fed


Source: U.S. Bureau of Labor Statistics,

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Philip Rich

Chief Investment Officer

This information is for informational purposes only and does not constitute investment advice.


  • GDP – Bureau of Economic Analysis
                            Employment & Inflation – Bureau of Labor Statistics
                            Interest Rates – Federal Reserve
                            P/E S&P 500 –
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