Inflation fell four-tenths of a percentage point to 2.5% for the year in August, the Bureau of Labor Statistics reported Wednesday.

Investors widely expect that Fed officials will cut interest rates at the conclusion of their policy meeting next Tuesday and Wednesday. They have been betting that officials will most likely lower borrowing costs by a quarter of a percentage point from their current 5.33 percent, but a larger half-point move is also seen as possible.

The Consumer Price Index report shows inflation slowed for a fifth consecutive month in August as gas, used car prices decline.