Fed's preferred inflation gauge cools, adding to likelihood of a September rate cut

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Fed's preferred inflation gauge cools, adding to likelihood of a September rate cut
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The Federal Reserve’s favored inflation measure remained low last month, bolstering evidence that price pressures are steadily cooling and setting the stage for the Fed to begin cutting interest rates this fall. Prices rose just 0.1% from May to June, up from the previous month’s unchanged reading.

WASHINGTON — The Federal Reserve’s favored inflation measure remained low last month, bolstering evidence that price pressures are steadily cooling and setting the stage for the Fed to

Excluding volatile food and energy prices, so-called core inflation rose 0.2% from May to June, up from the previous month’s 0.1%. Measured from one year earlier, core prices increased 2.6%, unchanged from June. Yet with the pace of hiring cooling and the economy growing at a steady, if not robust, pace, it’s considered a near-certainty that the Fed will cut its benchmark interest rate when it meets in mid-September. The central bank will first meet next week. But Powell is expected to say afterward that the Fed’s policymakers still want to see additional data to be sure that inflation is slowing consistently.

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