Consumer Price Index (CPI)

The consumer price index is a key measure of inflation, tracking how price levels are changing across the US economy.

Inflation has been moderating over the last few years, after jumping to almost 8% in 2021. Current forecasts show a far more manageable 2.3% for 2024 – very close to the ideal of 2% inflation. Long-term forecasts mostly agree, barring any more unforeseen shocks to the global economy. There are also signs that China’s deflation is giving another disinflationary boost to core goods. Short-term inflation expectations have come down sharply in recent months on lower prices of gasoline and energy. The Federal Reserve is expected to begin cutting interest rates over the coming year, likely because they feel high interest rates are unnecessary to keep inflation in check.

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