WASHINGTON - US President Donald Trump hailed cooler-than-expected April inflation data and reiterated his call for the Federal Reserve to cut interest rates, as analysts warned that his tariffs may still fuel price hikes in the months ahead.
The April data covers the early days of Trump's new levies against most countries -- including steep duties on China -- which spooked financial markets and raised fears of a spike in US prices.
Trump has since scaled back some of the duties and paused others, helping to soothe nervous investors, though tariffs remain well above their recent historical average.
The consumer price index (CPI) eased to 2.3 percent in April from a year ago, a tick below the 2.4 percent figure recorded in March, the Labor Department said in a statement.
The April CPI release was the smallest 12-month increase since February 2021, and was slightly lower than the median estimate from surveys of economists conducted by Dow Jones Newswires and The Wall Street Journal.
The inflation data did not make waves in the US financial markets, which ended the day mixed.
Several analysts struck a cautious note about inflation on Tuesday, suggesting that now was not the time for the Fed to cut rates.
"This may be the low point in 2025," Nationwide senior economist Ben Ayers wrote in a note shared with AFP.
"As tariff costs increasingly flow into consumer prices, we expect a jump in the CPI this summer, pushing the annual reading back above three percent," he added.
"Looking ahead, higher tariffs will lead to a renewed inflation impulse," EY chief economist Gregory Daco said in a statement.
But, he added, the recent tariff detente with China means that impulse will be slightly weaker than previously expected.