Inflation was slightly lower than scheduled in April when President Donald Trump’s prices had just started to slow down the American economy, according to a report from the Labor Department on Tuesday.
The consumer price index, which measures the costs of a wide range of goods and services, has increased by 0.2% seasonally adjusted for the month, which puts the inflation rate from 12 months to 2.3%, its lower since February 2021, said the Bureau of Labor Statistics. The monthly reading was in accordance with the estimate of the Dow Jones consensus while the 12 months was a little below the forecasts of 2.4%.
By excluding the volatile prices of food and energy, the basic IPC also increased by 0.2% for the month, while the level from one year to the other was 2.8%. Forecasts were 0.3% and 2.8% respectively.
The monthly readings were a little higher in March, although price increases remain well of their summits three years ago.
The markets reacted little to the news, the term contracts by stock pointing to a little lower and the yields of the treasure mixed.
The prices of the refuge were again the main culprit of the push of the inflation gauge. The category, which is about a third of the weighting of the index, increased by 0.3% in April, representing more than half of the global movement, according to the BLS.
After posting a slide 2.4% in March, energy prices rebounded, with a 0.7% gain. Food saw a drop of 0.1%.
The prices of used vehicles saw their second consecutive drop, down 0.5%, while new vehicles were stable. Clothing costs have also been reduced, although medical care services increased by 0.5%. Health insurance increased by 0.4% while motor vehicle insurance increased by 0.6%.
Egg prices dropped, down 12.7%, although they still increased by 49.3% compared to a year ago.
While the ICC figures in April were relatively tamed, Trump’s prices remain a joker in the image of inflation, depending on where negotiations take place by the summer.
In his long -awaited announcement of the “Liberation Day”, Trump slapped 10% of rights to all American imports and said that he intended to put additional “reciprocal” prices on business partners. Recently, however, Trump fell off his position, with the most dramatic development a 90 -day stay on aggressive prices against China while the two parties enter other negotiations.
The markets expect that the president’s softening position leads to less interest rate drops this year. The merchants expected the federal reserve to start in June, with at least three total discounts probably this year.
Since the developments in China, the market has released the first decrease in September, with only two probably this year, because the central bank feels less pressure to support the economy and inflation has maintained above the target target of the Fed for more than four years.
The Fed is more based on the inflation gauge of the trade department for the development of policies, although the IPC appears in this index. BLS will publish its April reading on the prices of producers on Thursday, which is considered a leading indicator on inflation.
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