US Inflation Slides to 3%, Lowest Level in Two Years

Federal Reserve's Measures Pay Off

The United States has seen an impressive fall in inflation, reaching its lowest level in over two years in June, standing at 3%. This trend reflects the Federal Reserve's successful interest rate hikes in containing price increases throughout the economy in relation to the previous year.

Since March 2022, the Federal Reserve has raised its benchmark rate by a significant 5 percentage points, representing the most substantial pace of increases in four decades. In June, overall prices increased by 0.2%, a slight increase from the previous month's 0.1%, but still considered mild in comparison.

It demonstrates the progress made by the central bank in slowing down price acceleration. Notably, consumer inflation peaked at 9.1% in June 2022. Since then, gas prices have declined, food costs have moderated.

Despite declining sharply from the 4% annualization rate observed in May, the inflation rate remains above the Federal Reserve's target of 2%, according to the government's report on Wednesday.  As a result, it is widely anticipated that the Fed will increase its key interest rate in the upcoming meeting scheduled in two weeks. CME FedWatch indicates a 91.1% probability of the FOMC raising rates on July 25-26.

The favorable inflation news appears to have had little effect on Bitcoin, but traditional markets have seen movements. Bitcoin is trading at $30,781.23, up 1.25% in 24 hours, according to CoinMarketCap.