US Consumers Struggle as Inflation Persists Ahead of Fed Rate Decision

The US consumer market remains under strain as inflation shows no signs of abating, according to fresh data released on Friday. The personal consumption expenditures price index, a key indicator of inflation, rose to 2.8% in September, up from 2.7% in August. When food and energy prices are excluded, prices also increased by 2.8% in September, but at a slower pace than the previous month. A separate report showed a slight improvement in consumer sentiment, with the University of Michigan's index rising to 53.3 in December from 51.0 in November. However, consumers are still concerned about high prices, and their outlook for personal income and labor market expectations remains dismal. The mixed report, delayed due to the US federal government shutdown, is the last major inflation reading before the Federal Reserve's rate decision next week. Economists predict that the Fed will cut interest rates as expected, but may face opposition from policymakers who are concerned about inflation. The data shows that consumers are still feeling the pinch of high prices, particularly in categories such as durable goods like automobiles, appliances, and furniture, which rose 1.4% from a year ago. The Fed's decision will be closely watched as it navigates the delicate balance between controlling inflation and supporting economic growth.