Core US inflation (excl. energy and food) came in hot at 0.3% for August, above the 0.2% expected.
US Inflation came in at 0.2% in August, in line with the reading for July. Annual inflation cools to 2.5%, from 2.9% in July.
Annual core inflation remained steady at 3.2%.
Isaac Stell, Investment Manager at Wealth Club said, “While core US inflation came in a touch too warm over the summer, inflation more broadly continues to trend lower – easing enough for the Federal Reserve to begin cutting interest rates.
“The big debate now is whether it plumps for a 0.25% or 0.50% rate cut.
We suspect the Fed will be wary of taking the brakes off too quickly and risk inflation accelerating again. In the later stages of a fight with inflation it’s the tortoise, rather than the hare, that tends to emerge victorious – and in the absence of any major economic crises the Fed has little incentive to take the riskier path.”
