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Some Respite on the Inflation Front
Inflation continues to show signs of easing, with the December 2022 CPI falling 0.1% month over month, the largest drop for this measure since 2020. Year over year, prices were up 6.5%. With the huge run up in prices early in 2022, the annual CPI numbers do not capture the rapidly changing landscape for inflation. A 4.5% energy component decrease, helped by a mild winter and falling fuel oil prices, contributed to the tame CPI reading. The shelter component continues to be a big reason CPI hasn’t fallen more, and if that segment is removed from the calculation, the month-over-month decline would have been 0.5% for December, which equals an annualized drop of 6.2%.
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