Inflation in the US slowed in March to 5% year-on-year and stood at its lowest level in almost two yearsaccording to the CPI price index published this Wednesday by the Labor Department.
It is the drop in consumer prices to the lowest level since May 2021when they rose another 6% in February over the 12-month span.
Analysts expected prices to rise 5.1% in 12 months.
In Marchinflation was 0.1%, compared to the 0.2% expected and after 0.4% in February.
It was the drop in energy prices (-3.5% monthly and -6.4% annual) that favored the slowdown in the general inflation rate.
The call Underlying inflation, which excludes volatile sectors such as food and energy, also slowed slightly in a month to +0.4% from +0.5% in February. However, the annualized rate remained high, standing at 5.6% compared to 5.5% the previous month.
Rents and housing prices continued to rise strongly (+0.6% only in March), as did transportation (+1.4%).
“There are encouraging signs… but with core inflation still elevated, there is a good chance the Fed will continue to tighten with another final 25 basis point rate hike next quarter,” said Paul Ashworth of Capital Economics.
The next meeting of the Fed’s monetary policy committee is scheduled for May 2-3.
Source: AFP
