Cyclical|Consumer prices rose by 2.5 percent in August from a year ago.
Consumer prices inflation slowed to 2.5 percent in the United States in August, the country’s Ministry of Labor said on Wednesday.
Economists predicted in a Reuters poll that the inflation rate would have been 2.6 percent.
In August, energy became cheaper by 4.0 percent from a year ago. Food, on the other hand, became more expensive by 2.1 percent, services by 4.9 percent and housing by 5.2 percent.
Core inflation, closely monitored by the central bank and economists, was 3.2 percent, which is the same as in July.
Core inflation is an important measure because the direct impact of sensitively changing energy and food on consumer prices has been removed from it. It tells better about the wide range of inflation.
The US central bank will publish its next monetary policy decision next week.
Director general Jerome Powell hinted at the end of August that an interest rate cut was coming. The market has been guessing mainly on whether the central bank will resort to an interest rate cut of 0.25 percentage points or 0.50 percentage points.
“Service inflation is exceptionally fast, which reflects large wage increases. For this reason, we believe that the central bank will cut its key interest rate by 0.25 percentage points next week and will proceed cautiously”, says the market economist of financial group OP Jari Hännikäinen.
The prices of services rose by 4.9 percent in August.
Fast in order to tame inflation, the central bank has tightened monetary policy 11 times in just over two years. According to the central bank’s price stability objective, inflation must be two percent on average over a long period of time.
The central bank stopped the tightening of monetary policy in June last year, but continued it once more in July. Since September, it has kept the policy rate unchanged in the range of 5.25-5.50 percent.
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