By: AZ Big Media
Merriam-Webster’s 2022 word of the year was gaslighting — a form of deceit where someone is manipulated into questioning the validity of their own reasoning — but there was a well-known noun burning in the minds of many last year: inflation. Indeed, December’s Consumer Price Index (CPI) report showed that prices for all items rose 0.1% in November and were up 7.1% over the prior year. And inflation plays a big role in Arizona’s economic outlook for 2023.
“Core CPI, which excludes food and energy prices, increased 0.3% from September to October — a marked step down from the 0.6% reading the previous two months and the average 0.5% over the first nine months of ,” explains Christopher Waller, a member of the Board of Governors of the Federal Reserve, during Arizona State University’s (ASU) Economic Forecast Luncheon on Nov. 16, 2022.
Even though the apparent slowing of inflation is welcome news, Waller cautions against thinking the U.S. is fully out of this economic briar patch. He notes that other monthly CPI reports since the onset of the pandemic have shown inflation rates dipping, only to rise again a few months later.
“We’ve seen this movie before, so it’s way too early to know if it’s going to have a different ending than what we saw [in 2021] and [summer 2022],” Waller continues. “Inflation remains too high relative to the [Federal Open Market Committee (FOMC)]’s target [of 2%].”