Inflation slowed down in April after several months of faster-than-expected price increases, according to data released Wednesday by the Labor Department.
The consumer price index (CPI), a closely watched inflation gauge, rose 0.3 percent in April and 3.4 percent over the previous 12 months, in line with economist expectations. Both monthly and annual inflation fell 0.1 percentage points from their March levels.
The new inflation numbers come amid increasing concern among policymakers and investors over the path of price increases in the U.S. After falling sharply throughout the past two years, inflation had appeared to plateau with plenty of room left to fall toward the Federal Reserve’s target of 2 percent annual price increases.
Higher-than-expected inflation has forced the Fed to delay plans to cut interest rates from their current baseline of 5.25 to 5 percent, the highest level in more than two decades. Sticky inflation is also a major challenge for President Biden and Democrats, who are struggling to turn around public opinion about the economy ahead of the 2024 election.
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