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Spending

Irene Schaefer, of Johnson Creek, Wis., shops for hats at Longhorn Saddlery in Dubuque, Iowa, on Friday, Dec. 30, 2022. (Jessica Reilly/Telegraph Herald via AP)

NEW YORK — Americans cut back on spending in December, the second consecutive month they’ve done so, underscoring how inflation and the rising cost of using credit cards slowed consumer activity over the crucial holiday shopping season, according to an Associated Press report.

Retail sales fell worse-than-expected 1.1% in December, following a revised 1% drop in November, the Commerce Department reported Wednesday. In October, retail sales ticked up 1.3%, helped by early holiday shopping

Auto sales declined as rising interest rates for auto loans crimped demand. That, and falling gas prices, helped to pull overall retail sales lower.

The Fed raised its key interest rate in December for the seventh time in 2022 for exactly that reason as it tries to cool spending and inflation.

Yet even excluding sales from auto and gasoline, retail sales slipped 0.7%. Retail sales are not adjusted for inflation, unlike many other government reports.

Read the full Associated Press report.

Wholesale inflation in the US slowed further in December to 6.2%

WASHINGTON — Wholesale prices in the United States rose 6.2% in December from a year earlier, a sixth straight slowdown and a hopeful sign that inflation pressures will continue to cool, according to an Associated Press report.

The latest year-over-year figure was down from 7.3% in November and from a recent peak of 11.7% in March. On a monthly basis, the government said Wednesday that its producer price index, which measures costs before they reach consumers, dropped 0.5% from November to December.

The producer price data can provide an early sign of where consumer inflation might be headed. The data reflects the prices that are charged by manufacturers, farmers and wholesalers, and it flows into an inflation gauge that the Federal Reserve closely tracks, the personal consumption expenditures price index.

The ongoing slowdown in wholesale price growth is adding to evidence that the worst bout of inflation in four decades is steadily easing, though it remains far above the Federal Reserve’s target of 2%.

Read the full Associated Press report.