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US inflation cooled again in November, providing more hope that the Federal Reserve has engineered a soft landing for the world’s biggest economy and sending stocks closer to a new record high.
The S&P 500 rose by 0.2 per cent after federal data showed that prices increased more slowly than expected in November, putting Wall Street’s benchmark share gauge within 1 per cent of the all-time closing high it reached in January 2022.
The index has notched up eight straight weeks of gains — a record last achieved in 2017 — and is heading for its third-best year in the past decade after a volatile 12 months.
“There is mounting evidence that the post-pandemic inflation scare is over and we expect interest rates to be cut significantly next year,” said Andrew Hunter, economist at research firm Capital Economics.
President Joe Biden hailed Friday’s report from the Bureau of Economic Analysis as a “significant milestone” in efforts to return inflation back to its pre-pandemic levels.
“As we head into the holidays, prices are down from a year ago on important items including a gallon of gas, a gallon of milk, toys, appliances, electronics, car rentals and airline fares,” Biden said.
The BEA release showed that November’s core PCE inflation reading — economists’ preferred measure because it strips out volatile energy and food prices — rose by…
