SwedenLivingWorld world_2_fill WorldBusiness BusinessSports sports-soccer SportsEntertainmentEntertain

Lowest US inflation since 2021

The underlying inflation in the USA fell for the fourth month in a row in July, to the lowest level since 2021. This is a step in the right direction for the Fed to lower the interest rate, says Maria Landeborn, senior strategist at Danske Bank.

» Updated: 15 August 2024, 08:43

» Published: 14 August 2024

Lowest US inflation since 2021
Photo: Eduardo Munoz Alvarez AP/TT

New inflation figures from the USA strengthen the image that the USA's central bank may lower the interest rate next month.

Inflation according to the KPI measure fell to 2.9 percent in July from 3.0 percent in June, according to the USA's labor market department. The average forecast among analysts was 3.0 percent, according to a compilation made by Bloomberg.

It's positive that it comes a little below expectations. If it had been too low, it could have been interpreted as a decline in demand in the economy, says Maria Landeborn.

"Right direction"

The underlying inflation, which is the measure that the Fed primarily looks at and which excludes food and energy prices, landed at 3.2 percent. It is the lowest level since 2021.

According to Landeborn, the figures mean that the Fed will stick to its previous message that interest rates will start to fall after the summer.

This is a step in the right direction for the Fed to lower the interest rate. The market assesses that the chance is equally great for a double reduction as a single reduction, but I don't think they'll lower 50 points, I think it'll be 25 points. A double reduction would signal concern, and that's what they want to avoid, she says.

Moderate reaction

The rise on the Stockholm Stock Exchange increased marginally after the figures, and the dollar is stable at 10.42 kronor. Short-term market interest rates in the USA rose slightly, and Wall Street is rising in pre-trading.

The decline in inflation follows weak labor market figures from the USA that shook stock exchanges around the world last week.

Before the next interest rate meeting in September, the Fed will also have figures for inflation in August and new labor market figures to consider.

Tags
TTT
By TTThis article has been altered and translated by Sweden Herald

More news

Took a tough stance on crypto companies - resigns
1 MIN READ

Took a tough stance on crypto companies - resigns

Ingvar Carlsson on PG: "A very loyal friend"
2 MIN READ

Ingvar Carlsson on PG: "A very loyal friend"

No Wage Guarantee in American Process
1 MIN READ

No Wage Guarantee in American Process

He became "PG" to the entire Swedish people
3 MIN READ

He became "PG" to the entire Swedish people

PG Gyllenhammar has died: "meant a lot"
1 MIN READ

PG Gyllenhammar has died: "meant a lot"

No Nvidia boost on Wall Street
1 MIN READ

No Nvidia boost on Wall Street

Temu's owner shows its hand
1 MIN READ

Temu's owner shows its hand

Nvidia rises in pre-trading on Wall Street
1 MIN READ

Nvidia rises in pre-trading on Wall Street

Reconstruction in the USA to Save Northvolt
2 MIN READ

Reconstruction in the USA to Save Northvolt

Northvolt: Negotiations are still ongoing
3 MIN READ

Northvolt: Negotiations are still ongoing

Higher Compensation for Job Interviews in Another Location
1 MIN READ

Higher Compensation for Job Interviews in Another Location

Vehicle Giant Warns of Challenges in 2025
1 MIN READ

Vehicle Giant Warns of Challenges in 2025

Unchanged interest rate in Turkey
1 MIN READ

Unchanged interest rate in Turkey

Trump anxiety in the EU over US tariffs
3 MIN READ

Trump anxiety in the EU over US tariffs

Weak demand for scrapping premium
1 MIN READ

Weak demand for scrapping premium

E-fuel company takes in half a billion
1 MIN READ

E-fuel company takes in half a billion

New Report Boost for AI Giant Nvidia's Share
2 MIN READ

New Report Boost for AI Giant Nvidia's Share

Stockholm Stock Exchange Turned Upwards
1 MIN READ

Stockholm Stock Exchange Turned Upwards

Bitcoin closer to the dream limit
1 MIN READ

Bitcoin closer to the dream limit

Higher fee to stop burning of plastic
2 MIN READ

Higher fee to stop burning of plastic