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Consumer prices were up 2.9 percent from a year earlier in July.
This is the first time that overall inflation, measured on a yearly basis, has come in below 3 percent since March 2021.
On a monthly basis, prices rose 0.2 percent, in keeping with expectations.
Rate cuts on the way for the Federal Reserve
The inflation report, released by the Labor Department Wednesday, likely seals the case for the Federal Reserve to begin cutting interest rates at its next meeting in September.
Economists will now be considering how much the Fed is likely to cut benchmark borrowing rates by.
Lindsay Rosner, from Goldman Sachs Asset Management, said the data 'cleared the way' for a quarter-point rate cut by the Fed in September, 'while not completely shutting the door' on a half-point cut.
Interest rates have remained at a 23-year high between 5.25 percent and 5.5 percent since July 2023
Inflation slips to 2.9 percent in July, below expectations
Consumer prices were up 2.9 percent from a year earlier in July.
This is the first time that overall inflation, measured on a yearly basis, has come in below 3 percent since March 2021.
Economists surveyed by Dow Jones were expecting a 3 percent rise.
On a monthly basis, prices rose 0.2 percent, in keeping with expectations.
English (US)