U.S. Core Inflation Cools, Easing Pressure on the Fed
Underlying inflation in the United States remained subdued in July. Data from the Bureau of Labor Statistics showed that Core CPI, which excludes volatile food and energy prices, rose 0.2% from the previous month.
On an annual basis, Core CPI increased 2.5%, matching its slowest pace since March 2021. The reading suggests that underlying price pressures are continuing to move closer to the Federal Reserve’s inflation target.
Headline CPI, meanwhile, rose 0.1% month-on-month in July and increased 3.4% from a year earlier. The figures indicate that overall inflation remains elevated, but there was no fresh acceleration in price pressures.
The report comes after recent U.S. labor-market data showed signs of weakening. The combination of slower employment growth and relatively contained core inflation could reduce the urgency for the Federal Reserve to raise interest rates again in the near term.
However, headline inflation remains above the Fed’s 2% target, meaning policymakers are likely to stay cautious. Elevated energy prices and ongoing geopolitical tensions also remain key risks that could push inflation higher again in the coming months.(mrv)
Source : Newsmaker.id
