Inflation fell by a tenth of a percentage point to 2.3% for the year ending in April, the Bureau of Labor Statistics reported Tuesday in an update to the consumer price index.
Forecasters had expected inflation to hold at 2.4%.
Core inflation, a measure that strips out volatile food and energy prices, remained at a 2.8% annual rate.
The decline in the headline rate of inflation suggests that price pressures remain low, even as President Donald Trump carries out a trade war that has involved raising tariffs on countries all over the world. Economists generally expect that the tariffs will have the effect of raising prices, all else equal.
In the month of April alone, prices rose 0.2%. That is a relatively mild monthly rate of inflation that suggests that the tariffs imposed in April did not have an immediate strong effect on prices.
“This was another well-behaved CPI inflation report (the third in a row) that showed favorable moderation in goods and energy inflation,” BMO economist Scott Anderson wrote in a note on the CPI report.
Shelter and energy costs rose in April, offset by a decrease in food prices. Egg prices, in particular, plummeted after a sharp run-up earlier in the year.
Lower inflation gives the Trump administration breathing room to pursue its ambitious trade and fiscal agenda. In contrast, former President Joe Biden was hobbled politically by the run-up in inflation during his term.
Tuesday’s report could pave the way for the Federal Reserve to ease monetary policy. The Fed has so far hesitated to cut its interest rate target out of fear that the trade conflict could raise prices, but that dynamic has not yet materialized.
Meanwhile, Trump has pressed the Fed to lower rates. He has harshly criticized the chairman of the central bank, Jerome Powell, deriding him as “Too Late” and a fool because he has declined to lower rates. Powell maintains that he bases monetary policy decisions on his reading of the economy and won’t be swayed by political considerations or pressure from the president.
