US Inflation Continues to Slow Down for Ninth Month in a Row
The Bureau of Labor Statistics reported that US consumer price increases continued to cool down in March for the ninth consecutive month.
- Consumer Price Index dropped for the ninth consecutive month in March.
- Annual inflation fell to 5% for the 12 months ended in March, down from 6% in February.
- Monthly basis, CPI rose 0.1% from February, compared to a 0.4% increase.
- Economists were expecting an annual increase of 5.2% and a monthly gain of 0.2%.
- The drop in inflation was largely due to falling gasoline prices and the base effect from last year's pandemic-induced price drops.
- Core CPI, which excludes volatile food and energy prices, rose 0.3% month-over-month and 1.6% year-over-year.
- The Federal Reserve has said it expects inflation to be transitory, caused in part by supply chain disruptions and demand outstripping supply as the economy recovers from the pandemic.
- The central bank has signaled it will keep interest rates low until it achieves full employment and inflation above 2% for some time.
- The drop in inflation is good news for consumers, as it eases the pressure on household budgets and reduces the need for the Fed to raise interest rates to combat inflation.