WASHINGTON: The US Federal Reserve is making encouraging progress in the fight against inflation, a senior bank official said Tuesday, pointing to signs of slowing economic growth and easing price increases.

The Fed recently voted to hold its key lending rate at a 22-year high, lifting expectations that it is done hiking interest rates as it seeks to bring inflation down firmly to its long-term target of two percent.

“I am encouraged by what we have learned in the past few weeks – something appears to be giving, and it’s the pace of the economy,” Fed Governor Christopher Waller told a conference in Washington, in prepared remarks.

Fed expects interest rates to stay high ‘for some time’

Economic data from October “are consistent with the kind of moderating demand and easing price pressure that will help move inflation back to two percent,” he added.

The strong economic growth of the first three quarters of the year appears to be slowing in the final quarter, Waller said, pointing to a decline in retail sales data for October.

The decline in spending in the interest rate-sensitive motor vehicles sector “may be evidence” that the Fed’s monetary policy is having some effect, he explained.

Meanwhile, inflation moved “in the right direction in October, albeit gradually,” and the tight job market is showing some signs of cooling, he added.

Futures traders currently assign a probability of around 94 percent that the Fed will vote to hold interest rates steady on December 13, according to CME Group data.