With the consumer price index and producer price index now available, total PCE (personal consumption expenditures) inflation in December is likely to have run at around a 2.3 percent annualized pace on a 3- and 6month basis, as compared with 5.1 percent on a 12-month basis.
This deceleration reflects an easing in war-related energy shocks as well as in core goods inflation: Energy and core goods each subtracted nearly three-fourths of 1 percentage point from 3-month annualized total PCE inflation. The declines in energy and core goods are a reversal of previous large increases and are expected to moderate.