(CMR) Inflation in the United States has reached its lowest point in more than two years, with annual inflation at 3% in June, the lowest since March 2021. From May to June, overall prices rose 0.2 percent, up from just 0.1 percent in the previous month but still comparatively mild.
According to the Associated Press, the inflation figure the government reported Wednesday was down sharply from a 4 percent annual rate in May, though still above the Fed’s 2 percent target rate.
AP reported that there has been a drop in gas prices, while grocery costs have risen more slowly and used cars have become less expensive over the past 12 months, but some underlying inflation pressures remain a concern for the Federal Reserve.
This means inflation hikes are likely to increase again in the next two weeks. The Fed has raised its benchmark rate by a substantial 5 percentage points since March 2022, the steepest pace of increases in four decades, according to AP.
Some economists have suggested that if inflation keeps slowing and the economy shows sufficient signs of cooling, the July increase could be the Fed’s last. A sustained slowdown in inflation could bring meaningful relief to American households that have been squeezed by the price acceleration that began two years ago, AP reported.
Gas prices have reportedly fallen back to about $3.50 a gallon on average, nationally, down from a $5 peak last year. And grocery prices are rising more slowly, with some categories reversing previous spikes. Egg prices, for instance, have declined to a national average of $2.67 a dozen, down from a peak of $4.82 at the start of this year, AP reported.
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