Inflation Slows to 3.1% Annual Rate, But Not Everyone Feels the Cooling Effect

The Federal Reserve appears to be on the verge of defeating inflation without causing a steep recession, as inflation has been steadily falling since its peak in June 2023. Goods prices have fallen for six consecutive months, housing and rental costs are growing more slowly, and wage growth has cooled. Economists credit the Fed's rapid rate hikes and improved global supply chains for contributing to the decline in inflation. While there may be bumps along the way, many economists believe that inflation is nearly back under control. The Fed's more optimistic stance and rate-cut projections have sent stock market indexes soaring, but officials remain cautious and want to see further evidence of falling inflation before feeling confident.