Inflation cooled in August, with the Consumer Price Index (CPI) rising 2.5% annually, down from 2.9% in July. This marks the first time in over two years that inflation has dipped below 3%.
However, concerns of an economic slowdown persist due to recent disappointing job gains and a spike in unemployment.
Core CPI, which excludes volatile food and energy prices, increased 3.2% year-over-year, unchanged from July.
Read: US Confirms Iran’s Ballistic Missile Shipments To Russia, Leading To International Sanctions
These figures come amidst growing fears of an economic slowdown. Unemployment rose in July, and job growth in August was lower than expected. The downward revision of over 800,000 jobs for the period between April 2023 and March 2024 has also added to the concerns.
The Federal Reserve’s response to high inflation under the Biden administration has been to raise interest rates to a 23-year high.
Read: Op-Ed: The Big Trump-Harris Debate Informed Little, Changed Less
However, with inflation showing signs of easing, there’s growing expectation that the Fed may lower interest rates at its September meeting. This would reduce borrowing costs and potentially stimulate economic growth.
Market expectations, as reflected in the CME Group’s FedWatch Tool, suggest a high probability of a rate cut, though the exact magnitude remains uncertain.
Please make a small donation to the Tampa Free Press to help sustain independent journalism. Your contribution enables us to continue delivering high-quality, local, and national news coverage.
Android Users: Download our free app to stay up-to-date on the latest news.
Connect with us: Follow the Tampa Free Press on Facebook and Twitter for breaking news and updates.
Sign up: Subscribe to our free newsletter for a curated selection of top stories delivered straight to your inbox.