US consumer price inflation slowed to an annual rate of 3.5% in June, providing a welcome reprieve for households and markets alike.
The deceleration was primarily driven by a sharp decline in gasoline prices, alongside softer costs for apparel and used vehicles.
Underlying price pressures also cooled more than anticipated, signaling a broad-based easing in the inflationary trend.
The Consumer Price Index fell 0.4% month-on-month, marking a stark reversal from the 0.5% increase recorded in May.
This monthly drop underscores the volatility of energy costs and their outsized impact on headline figures.
The cooling in core metrics suggests that the Federal Reserve may have more flexibility in its upcoming policy decisions, as the immediate threat of entrenched price growth appears to be receding.