U.S. Consumer Price Index Shows Lower Than Anticipated Increase in April; Annual Growth Hits Four-Year Low

Overview

Inflation in the United States showed signs of easing in April, with the year-over-year Consumer Price Index (CPI) recording its slowest increase in over four years. The April CPI rose only 0.2%, below analysts’ expectations of 0.3%, and recovering from March’s -0.1%.

Key Points

The year-over-year CPI grew by 2.3%, marking the lowest rate since February 2021.
Core CPI, excluding volatile food and energy prices, also increased by 0.2%, aligning with forecasts for the year at 2.8%.
Following this data, Bitcoin (BTC) traded at $103,800, reflecting minor gains made overnight.

Market Reactions

U.S. stock indices responded variably, transitioning from modest losses to slight gains, while the yield on the 10-year Treasury dropped to 4.44%. With signs of stagnating inflation, it appears that the Federal Reserve’s cautious stance on interest rates is validated.

Future Outlook

Despite the positive inflation data, it seems unlikely to impact plans for Federal Reserve rate adjustments. Current probabilities suggest only an 11% chance of a rate cut in June, significantly decreasing from 80% just a month prior.

U.S. April inflation data released Tuesday morning *U.S. April inflation data released Tuesday morning (Maria Lin Kim/Unsplash) *

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