Michelle ThompsonIn August, the core PCE price index increased from 0.1% to 0.3% on a monthly basis.
Commerce Department data issued on Friday show that, on an annual basis, the US Federal Reserve’s favored inflation indicator weakened in September.
September saw an annual increase in the core personal consumption expenditures (PCE) price index of 3.7%, a minor decrease from the revised August number.
Although the number was in line with market expectations, the August annual growth was cut down from 3.9% to a gain of 3.8%.
However, the index increased by 0.3% on a monthly basis in September, matching market expectations and quickening from a 0.1% monthly increase in August.
Food costs climbed by 0.3% and energy costs increased by 1.7% each month.
Food costs increased 2.7% on an annual basis, while energy prices decreased less than 0.1% in September of this year over the previous year.
Food and energy costs are included in the PCE price index, which increased 3.4% in September. This increase followed a 3.4% year-over-year growth in August that was similarly consistent with market expectations.
After gaining 0.4% month over month in August, the index increased by 0.4% on a monthly basis in September, slightly exceeding market forecasts of a 0.3% gain.
In an effort to control unprecedented inflation, the Federal Reserve has raised interest rates eleven times since March 2022, bringing the federal funds rate to its highest level in twenty-two years, the 5.25%–5.5% target range.
According to the bank’s projection materials released last week, after having sent two rate rises this year, it anticipates an additional hike in one of its two remaining meetings this year and fewer rate cuts for next year.
