Blitz Bureau
WASHINGTON: Inflation in the US continued to cool last month, official figures showed, raising confidence that the US Central Bank will cut interest rates next week.
Consumer prices rose 2.5% over the 12 months to August, as prices for petrol, used cars and trucks, and some other items fell.
That marked the slowest pace since February 2021 and was down from 2.9% in July, despite an unexpected rise in housing costs.
The Labor Department figures come during a presidential campaign in which rising living costs have been a key issue, according to a BBC report.
Analysts said the data increased the likelihood that the Federal Reserve would cut interest rates by 0.25 percentage points at its meeting next week, but reduced the odds of a bigger cut. “Overall, inflation appears to have been successfully tamed, but with housing inflation still refusing to moderate as quickly as hoped, it hasn’t been completely vanquished,” said Paul Ashworth, chief North America economist for Capital Economics. The data shows price pressure is fading for key household items.
Grocery prices, which were surging just a few years ago, were unchanged from July to August and are up less than 1% from a year ago, according to the report. The cost of petrol has also dropped, falling over the month and more than 10% from August 2023.
