The Federal Reserve’s preferred inflation measure today provided the latest sign that price pressures are easing, a trend that is expected to fuel further Fed interest rate cuts this year and next, according to the Associated Press.
Prices rose just 0.1% from July to August, the Commerce Department said, down from the previous month’s 0.2% increase. Compared with a year earlier, inflation fell to 2.2%, down from 2.5% the previous month and barely above the Fed’s 2% inflation target.
Excluding volatile food and energy costs, so-called “core” prices rose just 0.1% from July to August, also down from the previous month’s 0.2% increase. Compared with 12 months earlier, core prices rose 2.7% in August, slightly higher than in July.
