US Inflation at 2-Year Low

Inflation in the United States fell to its lowest annual rate in over two years in June, driven by a slowdown in costs and favorable comparisons to a period of high price increases. The consumer price index rose 3% compared to the previous year and increased by 0.2% every month lower than the expected 0.3% rise. When excluding volatile food and energy prices, the core CPI rose 4.8% year-on-year and 0.2% month-on-month, slightly below consensus estimates. The decline in inflation provides some relief for the Federal Reserve as it seeks to address the high inflation rates experienced in 2022. Despite the improvement, core inflation remains well above the Fed's 2% target. Economists believe that the Fed will still likely raise interest rates later in the month.