Inflation Slows: Rate Cut Hopes Rise Amid CPI Data

Inflation Trends and Consumer Price Index (CPI) Insights

The Consumer Price Index (CPI) report for August is expected to show a headline inflation rate of 2.5%, marking a slowdown from July's 2.9% annual increase. The CPI measures the average change over time in the prices paid by consumers for goods and services, which helps determine the rate at which prices are rising. For context, if a gallon of milk cost $3 last year, and inflation was at 2.5%, the same milk might cost about $3.08 this year. This data is crucial as it directly influences the Federal Reserve's decisions on interest rates.