12/18/2023

The Fed May Have Accomplished a 'Soft Landing' for the Economy

Their efforts have assuaged the impacts of rising inflation

It was the most painful inflation Americans had experienced since 1981, when “The Dukes of Hazzard” and “The Jeffersons” were topping the TV charts. Yet the Federal Reserve now seems on the verge of defeating it — and without the surge in unemployment and the recession that many economists had predicted would accompany it.

Inflation has been falling more or less steadily since peaking in June of last year at 9.1 percent. And when the Fed's preferred inflation gauge for November is reported next week, it's likely to show that in the past six months, annual inflation actually dipped just below the Fed's target of 2 percent, economists at UBS estimate.

The cost of goods, such as used cars, furniture and appliances, has fallen for six straight months. Compared with a year ago, goods prices are unchanged, held down by improved global supply chains.

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