Consumer prices in the USA rose steadily last month as expected, reinforcing market expectations that the Federal Reserve will continue to lower interest rates next week.

Data released by the Labor Statistics Bureau on Wednesday showed that the so-called core Consumer Price Index, excluding food and Energy costs, rose 0.3% for the fourth consecutive month. This Index increased by 3.3% year-on-year.

Economists believe that core inflation better reflects underlying inflation trends than the overall CPI, which includes volatile food and Energy prices. Overall CPI rose by 0.3% month-on-month, with a year-on-year increase of 2.7%.

The S&P 500 Index opened higher, and US Treasury yields fell after the release of the CPI data.

As one of the most persistent sources of inflation in recent years, housing costs have cooled compared to the previous month but still account for nearly 40% of the overall increase.

"Particularly considering the slowdown in the housing category, this will reassure the Federal Reserve about lowering rates by 25 basis points in December and continuing to cut in 2025," said Citigroup economists Veronica Clark and Andrew Hollenhorst in a Research Report.

Although price pressures have eased from the peak during the post-pandemic recovery, recent anti-inflation progress has been steady, prompting some Federal Reserve officials to advocate for a more gradual pace of rate cuts in the future.