Tame inflation, low gas prices and rising wages are putting more dollars in the pockets of American workers, a positive sign for consumer spending headed into 2019.
After adjusting for inflation, average hourly earnings rose a seasonally adjusted 1.1% in December from a year earlier, the strongest rate of growth since September 2016, the Labor Department said Friday.
Meantime, consumer prices declined a seasonally adjusted 0.1% last month from November, the Labor Department said in a separate report. Prices excluding food and energy—the “core” measure closely monitored by Federal Reserve policy makers—increased 0.2%.
Muted inflation diminishes the odds the Fed will raise interest rates any time soon. The mix of low price pressures and steady wage gains appears to leave consumers in good shape.
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