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2w ago

U.S. Inflation Slows to Lowest Annual Rate Since 2021

April's CPI report shows a 2.3% annual increase, with core inflation persisting at 2.8%, as tariff impacts remain unclear.

A shopper walks by the sodas aisle at a grocery store in Los Angeles.

Overview

  • The Consumer Price Index (CPI) rose 0.2% in April and 2.3% year-over-year, the smallest annual increase since February 2021.
  • Core inflation, which excludes food and energy, increased 0.2% for the month and remains elevated at 2.8% annually, above the Federal Reserve's 2% target.
  • Economists note that the effects of President Trump's new tariffs, implemented in early April, have not yet significantly impacted consumer prices.
  • Shelter costs rose 0.3% in April, accounting for over half of the monthly CPI increase, while energy and grocery prices fell, including a 12.7% drop in egg prices.
  • A temporary 90-day tariff truce between the U.S. and China has reduced some trade tensions, but uncertainty persists regarding future inflation trends and monetary policy decisions.