What Inflation Drops to 3.4 Percent Means for YOU: How Rising Prices Affect Your Credit Card Rate, Home Prices, and 401(K)

The annual inflation rate decreased slightly to 3.4 percent in April, down from 3.5 percent in March.

Prices continue to be driven by the cost of gasoline and housing which, combined, contributed to more than 70 percent of the Consumer Price Index (CPI) gains over the past 12 months.

So-called ‘core prices’, which exclude volatile food and energy costs, rose 3.6 percent in the year to April, the lowest increase since the same month in 2021.

The figures, released by the Bureau of Labor Statistics on Tuesday morning, offer slight relief to economists after three consecutive CPI releases suggested that price pressures continue to put pressure on the U.S. economy.