A key gauge of US consumer prices in November posted the smallest monthly advance in more than a year, indicating the worst of inflation has probably passed and validating an anticipated slowing in the pace of Federal Reserve interest rate rises. Excluding food and energy, the consumer price index rose 0.2 per cent in November and was up 6 per cent from a year earlier, a Labour Department report released on Tuesday showed. President Joe Biden heralded the news as proof that his administration's economic strategy is working and expressed cautious optimism about the American economy after the new data showed inflation easing. “It's been a rough few years for hardworking Americans and for small businesses as well. And for a lot of folks, things are still pretty rough,” Mr Biden said at the White House. “But there are bright spots all across America. We're beginning to see the impact of our economic strategy. “I've never been more optimistic about America's future. And today's news gives me another reason to be optimistic about that future.” Economists see the inflation gauge — known as the core CPI — as a better indicator of underlying inflation than the headline measure. The overall CPI increased 0.1 per cent from the prior month and was up 7.1 per cent from a year earlier, as lower energy prices helped offset rising food costs. US stock futures surged and Treasury yields plummeted following the report. The median estimates in a Bloomberg survey of economists called for a 0.3 per cent rise in both the core and overall measures. The report, the last of 2022, points to inflation that — while much too high — is beginning to ease. While the Fed will likely welcome the deceleration, <a href="https://www.thenationalnews.com/business/economy/2022/11/30/us-interest-rate-rises-could-soon-be-scaled-back-jerome-powell-says/" target="_blank">c</a><a href="https://www.thenationalnews.com/business/economy/2022/11/30/us-interest-rate-rises-could-soon-be-scaled-back-jerome-powell-says/" target="_blank">hairman Jerome Powell</a> has emphasised both the central bank’s commitment to returning inflation to the Fed’s goal and the uncertainty of the outlook. Economists broadly expect annual price growth to slow substantially next year, but it is unclear how bumpy or painful the path back to the central bank’s target will be. Mr Biden warned that more work remains to be done. “I want to be clear: it's going to take time to get inflation back to normal levels,” he said. “As we make the transition to a more stable growth, we could see setbacks along the way as well. We shouldn't take anything for granted.” The Fed concludes its two-day policy meeting on Wednesday and is expected to announce a half-point interest rate increase. While that would be a smaller rise than enacted in the past four meetings, it would put rates at the highest level since 2007. Economists expect further tightening next year followed by an extended pause as policymakers assess the nation’s inflation trajectory and persistence. Market participants see the central bank cutting rates before the end of next year. <i>Bloomberg contributed to this report</i>