Good news, folks! Inflation has risen just 0.1% in March, which is less than what was expected.
Thanks to the Federal Reserve’s interest rate hikes, we're starting to see the impact on the economy.
The consumer price index, which measures the costs of goods and services in the U.S., rose 0.1% for the month, compared to the Dow Jones estimate of 0.2%. Additionally, it increased by 5% from a year ago, versus the estimate of 5.1%.
While inflation is still higher than what the Fed is comfortable with, the good news is that it's showing signs of slowing down.
The policymakers target inflation around 2% as a healthy and sustainable.
CPI was the smallest since June 2021.
Energy costs have dropped by 3.5%.
The food index remained unchanged.
Used vehicle prices are now down 11.2% year over year.
Medical care services costs also fell 0.5% for the month.
As the economy slows down, consumer prices will continue to decelerate, and this should bring inflation closer to the Fed’s long-run target of 2%.
Markets are likely to react positively to this report as investors gain more confidence that the next Fed meeting may be the last meeting when the Committee raises the fed funds target rate.
So, let's keep our spirits high and continue to work towards building a better and more sustainable economy.
The Fed is hoping to calibrate policy so that the slowdown it is trying to engineer in the labor market doesn't tip the economy into a recession.
With GDP growth tracking at a 2.2% annualized pace in the first quarter, we can be optimistic about the future. Remember, even small progress is still progress, so let's keep moving forward. Have questions about your next home purchase or buying power? Let’s talk!
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