US inflation below 5% for first time in two years

Prices for milk, airline tickets and new cars fell in the US last month, helping drive inflation to its lowest rate in two years.

Inflation, the pace at which prices rise, was 4.9% over the 12 months to April, official figures show.

That was down from 5% in March, and marks the tenth month in a row that price rises have slowed.

The fall comes after the US central bank continuously raised interest rates to try and slow the economy.

But it has hesitated to declare victory, as prices for some items keep climbing.

Housing, clothing, petrol and used car prices all jumped from March to April.

"With inflation in the US now below 5% for the first time in two years, markets will be thinking the light at the end of the tunnel is getting brighter, and the worst of this inflation is far in the rear-view mirror," said Richard Carter, head of fixed interest research at Quilter Cheviot.

"That said, inflation remains well above the target level, and core inflation is proving stickier."

The Federal Reserve has raised interest rates by five percentage points since last March, bringing them to the highest levels since 2007.

The moves are intended to discourage people from borrowing, leading to a slower economy and easing the pressures pushing up prices.