‘Make no mistake,’ one analyst says, ‘Demand is cooling off. … But it’s not a freefall.’
Consumer prices rose 3.2 percent from a year earlier, up from a 3 percent annual rise in June, the lowest rate in more than two years.
Friday’s report from the Labor Department raises the possibility that inflationary pressures might be easing and that the Fed might soon decide to pause its rate hikes.
An alarming sign that price pressures are entrenched in the American economy and could lead the Fed to keep raising interest rates well into this year.
The increase from December was nearly twice the rise that economists had been expecting.
The resilience of the American job market has been a major surprise. Last year, employers added 4.5 million jobs, second only to the 6.7 million that were added in 2021 in government records going back to 1940.