Consumers in the West Coast and across the nation received a bit of relief last month as inflation eased after running hotter than expected earlier in the year. The government said Wednesday that U.S. consumer prices overall rose 3.3% in May from the same month a year earlier. The new report will be welcomed by the Federal Reserve as it meets later Wednesday to consider interest rate policies.
“We still need several more months of this, but the fundamentals are encouraging,” said Paul Ashworth, chief North America economist at Capital Economics, a research firm. Most analysts expect the Fed to make one or two small cuts late in the second half of the year. The economy has shown some signs of cooling, although job growth remains strong and average wage gains are still running slightly above the rate of inflation.