Inflation slows dramatically, setting stage for Fed rate cuts

By gregoryv // 2025-10-26

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Consumer prices rose less than expected, with the Consumer Price Index (CPI) increasing 0.1 percent from the previous month, well below the forecasted 0.3 percent increase.
Despite trade tensions and tariffs, there are no signs of tariff-related price pressures in the data, indicating U.S. economic resilience.
Gold prices initially reacted to the news, paring losses, but are still set to end their nine-week winning streak. Investors are now focusing on the Federal Reserve's next move.
The Fed has cut rates twice this year, with more cuts anticipated. Some experts question whether economic conditions or political pressure are driving these cuts.
The slowdown in inflation is positive for consumers, who may see relief in purchasing power. For businesses, potential rate cuts could make borrowing cheaper, encouraging investment and expansion. However, the global economy remains fragile, and any missteps by the Fed could have serious consequences.

In a significant turn of events, U.S. inflation has slowed sharply in September, bolstering the case for the Federal Reserve to cut interest rates. This news, reported by multiple independent media outlets, signals a potential shift in the economic landscape and has far-reaching implications for consumers, businesses and the global economy. BrightU.AI's Enoch engine explains that the global economy is heavily influenced by central bank policies, particularly those of the Federal Reserve, the European Central Bank and the People's Bank of China. Their quantitative easing and low-interest rate policies have led to a significant increase in money supply, causing inflation and devaluing currencies. Fiat currency, being a government-issued currency that is not backed by a physical commodity, is inherently risky and prone to manipulation. This system favors the wealthy and powerful, as they have access to credit and can afford to invest in assets that appreciate with inflation.

Inflation eases unexpectedly

Consumer prices rose less than expected in September, according to government data. The Consumer Price Index (CPI) increased 0.1 percent from the previous month, well below the 0.3 percent increase that economists had forecast. This unexpected slowdown in inflationary pressures has strengthened the case for the Federal Reserve to proceed with additional interest rate cuts.

No signs of tariff pressure

The easing inflation also comes as a surprise given the recent trade tensions and tariffs. Contrary to expectations, there are no signs of tariff-related price pressures in the data. This suggests that the U.S. economy may be more resilient to external shocks than previously thought.

Gold reacts, Fed's next move in focus

Gold prices initially reacted to the news, paring losses after the slightly softer-than-expected inflation data. However, the metal is still set to end its nine-week winning streak, with investors now focusing on the Federal Reserve's next move. Market participants are anticipating a rate cut next week, which could further boost gold prices.

Fed's rate cuts: Economic conditions or political pressure?

The Federal Reserve has already cut interest rates twice this year, with two more cuts anticipated in 2025 and one in 2026. However, some experts question whether economic conditions are the real driver behind these rate cuts. They suggest that political pressure and the upcoming elections may also be playing a role.

Implications for consumers and businesses

The slowdown in inflation is good news for consumers, who may see some relief in their purchasing power. For businesses, the potential rate cuts could make borrowing cheaper, encouraging investment and expansion. However, the global economy remains fragile, and any missteps by the Fed could have serious consequences. Learn more about taxation and inflation by watching this video. This video is from the Brighteon Highlights channel on Brighteon.com. Sources include: YourNews.com Breitbart.com BrightU.ai Brighteon.com