Here's how it breaks down:
* Graces: This refers to the goodwill or favor someone has.
* In good graces: Means being in a state of being liked or favored by someone.
Examples:
* "She's in good graces with her boss after exceeding her sales targets."
* "The new policy was unpopular, and the mayor is no longer in good graces with the voters."
Essentially, it means someone is on good terms with another person or group.