A closely watched report on US inflation showed consumer price increases ticked lower on an annual basis during the month of August to hit a new three-year low, according to the latest data from the Bureau of Labor Statistics released Wednesday morning.
The Consumer Price Index (CPI) increased 2.5% over the prior year in August, a deceleration compared to July's 2.9% annual gain in prices and the lowest annual rate since early 2021. The yearly increase was also in line with economist expectations.
The index rose 0.2% over the previous month, matching both July's monthly increase and what economists had expected.
On a "core" basis, which strips out the more volatile costs of food and gas, prices in August climbed 0.3% over the prior month and 3.2% over last year. Core prices rose 0.2% month over month and 3.2% on an annual basis in July.
Although moderating, inflation has remained above the Federal Reserve's 2% target on an annual basis. However, recent economic data, including a weakening labor market, points to an all-but-certain rate cut by the end of the Fed's next policy meeting on Sept. 18.