Inflation Falls Below 3% for the First Time Since 2021
Consumer Prices Rose 2.9% in the Year Through July, a Downtick From the Prior Month
Inflation has eased to its lowest level since 2021, according to data released by the Bureau of Labor Statistics. Consumer prices rose 2.9% in the year through July, down from 3.1% in June. This is the first time that inflation has fallen below 3% since August 2021.
The decline in inflation is likely due to a number of factors, including falling energy prices and a slowdown in economic growth. The Federal Reserve has also raised interest rates in an effort to cool inflation.
While inflation has eased, it is still well above the Fed's target of 2%. The Fed is expected to continue raising interest rates until inflation falls closer to its target.
Americans Still Worry About the Total Rise in Prices Since COVID
Even though inflation has eased, Americans are still worried about the total rise in prices since the COVID-19 pandemic. A recent survey by the Pew Research Center found that 72% of Americans say that inflation has caused them financial hardship.
Americans are coping with inflation by shopping at discount stores and buying store-brand products. They are also cutting back on spending on non-essential items.
Slowest US Inflation Since 2021 Raises Rate Cut Hopes
The slowest inflation since 2021 has raised hopes that the Federal Reserve will soon start cutting interest rates. The Fed has raised rates six times this year in an effort to cool inflation.
If the Fed does cut rates, it would be a sign that the central bank believes that inflation is under control. This would be good news for consumers and businesses, as lower interest rates would make it easier to borrow money.
Conclusion
Inflation has eased to its lowest level since 2021, but it is still well above the Fed's target of 2%. Americans are still worried about the total rise in prices since the COVID-19 pandemic, and they are coping by shopping at discount stores and buying store-brand products.
The slowest inflation since 2021 has raised hopes that the Federal Reserve will soon start cutting interest rates. This would be good news for consumers and businesses, as lower interest rates would make it easier to borrow money.
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