The recent decrease in inflation indicates a higher likelihood of interest rate cuts by the Federal Reserve this fall. Following the release of positive data from the Consumer Price Index (CPI), the probability of a rate cut in September has surged to 83%. Some experts even suggest the possibility of a cut at the July meeting if certain conditions align. The recent CPI figures show a slightly lower increase in core inflation compared to expectations, strengthening the case for a rate cut in September. However, the decision also depends on future readings of the Fed's preferred inflation gauge and the state of the labor market. Federal Reserve Chair Jerome Powell has hinted at a shift in focus towards both stable prices and maximum employment, as the job market shows signs of cooling. Despite the progress in inflation, Powell remains cautious about the timing of rate cuts and the central bank's confidence in achieving its inflation target.