US Inflation Eases to 2.3% Annual Rate; Housing Costs Remain Primary Driver

April’s US consumer price data came in better than expected, with both headline and core inflation rising just 0.2% for the month, below the forecasted 0.3%. The annual inflation rate dropped to 2.3%, its lowest level since early 2021.

While some categories showed potential early impacts from recent tariff increases, economists believe it’s too soon to see the full effects. Grocery prices declined 0.4%, with egg prices seeing their largest drop since 1984. Markets responded positively to the inflation news, with S&P futures advancing and Treasury yields falling slightly.