In a key economic development, US inflation dropped to 2.4% in September 2024, marking the second consecutive month of decline. This is a critical move towards the Federal Reserve's target of 2%, signaling a stabilizing economy after a prolonged tightening campaign.
In August, inflation was recorded at 2.5%, which played a pivotal role in the Fedâs decision to cut interest rates for the first time in four years. The current drop continues to fuel optimism as the Federal Reserve may pursue further rate cuts in response.
Despite inflation remaining slightly above expectations (2.3%), the progress is evident, and many analysts believe the country is on track to achieving the 2% target. However, rising oil prices may pose challenges to further reductions.
All eyes are now on the Federal Reserve. Chair Adriana Kugler has already expressed support for more rate cuts if the inflation trend continues downward, with markets anticipating another 0.5% rate cut in November.
This development provides hope for a softer landing for the economy, but the road to reaching 2% inflation may still face obstacles.
