COLUMBUS, Ohio — The U.S. Labor Department released April’s consumer price index, and it showed that the year-over-year increase in the Consumer Price Index is less than it was in prior months.

The Labor Department released the most recent inflation numbers and prices rose 0.3% from March to April which is slightly lower than the 0.4% increase from February to March. While the change is small, it’s the first decline seen this year, giving the Federal Reserve some reassurance and relief. 

Prices in April 2024 are about 3.4% higher than they were this time last year, when measured year over year. This is an improvement from consumer numbers we saw in 2022 and 2023, but the Federal Reserve is still playing it safe.

The Federal Reserve is hoping to see inflation fall closer to their 2% target level before it starts cutting interest rates. Jonathan Ernest, an economics professor at Case Western Reserve University, said the Federal Reserve is using a “wait and see approach,” which it hopes will give the economy a soft landing instead of an instant recession. 

“We don't want to fall into a time where we have to speed up the economy much more than we can really handle and kind of overheat it, but we also don't want to slow it down too much either,” Ernest said. “It's sort of like when you're driving a car, the Fed has to read these signs far out ahead that give them an indication of what might be coming up, whether or not they should start to tap the brakes well before we get there.”

Although consumer inflation has seen some downward movement, production inflation is still relatively high. The current interest rate is living at around 5.3%, and Ernest said he doesn’t expect any more hikes if things continue to move in the right direction. Interest cuts are still hopeful by the end of the year.

Correction: This story previously misspelled Jonathan Ernest's name. This has been corrected. (June 11, 2024)