US consumer inflation eases more than forecast to 2.5%

The headline rate of US consumer inflation eased more than expected in August, according to government data published on Sept 11, bolstering expectations that the Federal Reserve will cut interest rates next week.

A rate cut would act to boost demand in the world's largest economy. That would give the Democratic Party some good economic news, going into the final stretch of the 2024 presidential election.

The consumer price index slowed to 2.5 per cent in August from a year ago, down from 2.9 per cent in July and the lowest annual figure since February 2021, the Labour Department said in a statement.

This was slightly below the median forecast of economists surveyed by Dow Jones Newswires and The Wall Street Journal.

Monthly inflation picked up by 0.2 per cent, in line with expectations.

"Today's report shows that we are turning the page on inflation," White House national economic adviser Lael Brainard said.

"With inflation coming back down close to normal levels, it is important to focus on sustaining the historic gains we have made for American workers during this recovery."