"Inflation rose slightly in August as companies continued to push the cost of tariffs onto consumers. The newest update to the consumer price index (CPI), which measures a basket of goods and services, showed that prices increased 2.9% over the last year the highest since January. Core CPI, which excludes energy and food costs, stayed stable at 3.1% after going up in July. Despite this slight uptick in inflation, Wall Street remains optimistic that the Federal Reserve will cut interest rates at the central bank's board meeting next week."
"At his closely watched speech at the Fed's Jackson Hole symposium last month, chair Jerome Powell said that recent economic circumstances may warrant adjusting our policy stance, which many investors took as a signal that the Fed will drop rates. Powell said that while tariffs have started pushing prices up, with no clear end, a slowdown in the jobs market has caught the attention of the Fed. Powell said that the downside risks to employment are rising."
Consumer prices rose 2.9% year-over-year in August, marking the highest annual increase since January, while core CPI excluding food and energy remained at 3.1%. Companies are passing tariff-related costs onto consumers, and the producer price index showed a slight wholesale-price dip in August after a July surge. Investors expect a quarter-point Federal Reserve rate cut at next week’s meeting amid signs of a weakening jobs market and market optimism. Policy rates currently range from 4.25% to 5.5%. The Fed remains focused on returning inflation to a 2% target while weighing employment downside risks and policy trade-offs.
Read at www.theguardian.com
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