WASHINGTON, Jan 12 (Reuters Breakingviews) - Americans’ jobs may just have a chance to survive the Federal Reserve’s fight against inflation. The Consumer Price Index fell 0.1% in December compared to the previous month, according to the U.S. Bureau of Labor Statistics, reflecting the largest one-month drop since April 2020. The Fed has warned that its efforts to cool price growth could lead to layoffs. As inflation falls back to earth, the central bank can put more effort into preventing widespread job loss.

The Fed has two main, specific, tasks: keeping inflation around 2% and ensuring all those who want to have jobs do. The central bank has more recently prioritized the former goal at the expense of the latter, with Fed Chair Jerome Powell arguing that permanently higher inflation would be more harmful to Americans than temporarily higher unemployment.

Inflation data released Thursday suggests Fed might not have to choose between the two. Prices for gasoline and vehicles fell last month, while the costs of dining out, grocery shopping, and medical care all rose less than in November. Unemployment, meanwhile, fell back to a 50-year low of 3.5% in December, and hiring continued to run strong. The inflation battle isn’t over yet, but it’s looking increasingly likely the Fed won’t have to sacrifice jobs to win it. (By Ben Winck)

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