The Labor Department on Wednesday said that the consumer price index (CPI) – a broad measure of how much everyday goods like gasoline, groceries and rent cost – rose 0.2% in August from the prior month
Prices climbed 2.5% in August from the same time last year, down from 2.9% in July. That’s the lowest level since February 2021.
So-called core prices, which exclude more volatile measurements of gasoline and food to better assess price growth trends, rose 0.3% in August from the prior month. The gauge was up 3.2% from a year ago, and unchanged from last month.
Overall, the report indicates that inflationary pressures in the U.S. economy are continuing to ease, though prices remain above the Federal Reserve’s 2% target.
The softer-than-expected inflation reading comes as Federal Reserve policymakers are set to hold a highly anticipated meeting in which they are likely to cut interest rates amid signs that the economy is cooling. After the central bank kept interest rates at a 23-year-high range of 5.25% to 5.5% in July, Fed Chair Jerome Powell signaled in an August speech at the Jackson Hole conference that the “time has come” to cut interest rates.