{"id":7690,"date":"2023-12-19T11:37:17","date_gmt":"2023-12-19T17:37:17","guid":{"rendered":"https:\/\/www.keystonefinancial.com\/?post_type=oi_article&p=7690"},"modified":"2023-12-19T11:37:52","modified_gmt":"2023-12-19T17:37:52","slug":"market-commentary-december-18-2023","status":"publish","type":"oi_article","link":"https:\/\/www.keystonefinancial.com\/articles\/market-commentary-december-18-2023","title":{"rendered":"Market Commentary | December 18, 2023"},"content":{"rendered":"\n

Have rates peaked?<\/p>\n\n\n\n

Last week, at its final policy meeting for 2023, the United States Federal Reserve indicated that rates may have peaked. After the meeting, Chair Jerome Powell said:<\/p>\n\n\n\n

\u201cAs we approach the end of the year, it is natural to look back on the progress that has been made toward our dual mandate objectives. Inflation has eased from its highs, and this has come without a significant increase in unemployment. That is very good news\u2026<\/p>\n\n\n\n

\u201cWhile we believe that our policy rate is likely at or near its peak for this tightening cycle, the economy has surprised forecasters in many ways since the pandemic, and ongoing progress toward our 2 percent inflation objective is not assured. We are prepared to tighten policy further if appropriate. We are committed to\u2026bring inflation sustainably down to 2 percent over time, and to keeping policy restrictive until we are confident that inflation is on a path to that objective.\u201d<\/p>\n\n\n\n

Powell\u2019s post-meeting comments added to positive inflation news from earlier in the week. The annual rate of inflation, as measured by the Consumer Price Index (CPI), fell to 3.1 percent in November from 3.2 percent in October.<\/p>\n\n\n\n

The inflation picture wasn\u2019t quite as rosy as that number suggests, though. Both headline inflation (+0.1) and core inflation (which excludes food and energy prices, +0.3) ticked higher month-to-month, and core inflation was 4.0 percent over the previous year.<\/p>\n\n\n\n

The primary contributor to annual core inflation was the cost of shelter, which includes rent, owners\u2019 equivalent rent, lodging, and renters\u2019 and homeowners\u2019 insurance. It was responsible for nearly 70 percent of the total increase in core CPI. Key contributors included:<\/p>\n\n\n\n