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Inflation at the lowest point in more than two years

Risky assets, however, aren't attracting investors

12.Jul.23 4:57 PM
By Abigail Richards
Photo Photobank


Inflation at the lowest point in more than two years

Inflation in the United States cooled down to 3 percent in June, the lowest level in over two years. One month earlier, the cost of living was 4 percent higher compared to May of the previous year.

The core inflation, which excludes volatile prices of fuel and food, also decreased from 5 percent in May to 4.8 percent in June. This indicator is crucial for the Federal Reserve's interest rate policy.

The Fed will hold a meeting later this month to discuss a new interest rate hike and has already indicated that the rate will almost certainly be raised. In June, the US central bank decided to pause the rate increase after raising it ten times in a row.

Economists describe the inflation figure for June as a "big surprise." According to the bank's experts, the Fed seems to be planning to continue with a rate hike in July. However, they also indicate that the need for further tightening afterward is questionable.

Investors on the New York stock exchanges responded optimistically on Wednesday. They are not eager for further interest rate hikes and pushed the key indices higher after the news of the inflation slowdown.

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