Your Evening Briefing: US Gets a Promising Sign Inflation Is Cooling

The US got the strongest sign yet that inflation may have finally peaked. Excluding food and energy, the consumer price index rose only 0.2% in November, the smallest monthly increase since August 2021. This inflation gauge is a key one for economists and a favorite of Federal Reserve Chair Jerome Powell, who has steered significant interest rate hikes to rein in soaring prices—including an expected half point raise this week. It’s a promising sign that the central bank’s strategy is working.

Nevertheless, the war isn’t over yet and high prices are here to stay for some time. And the Fed is unlikely to stop raising rates anytime soon either, as it chases down that magical unicorn known as the “soft landing.” For now anyway, Wall Street was filled with holiday spirit: Stocks and bonds rallied. Here’s your markets wrap.