The Federal Reserve’s preferred inflation gauge ticked up slightly in June as tariffs on imports started raising the cost of some goods – dampening hopes for an interest rate cut in September.
The Federal Reserve’s preferred inflation gauge ticked up slightly in June as tariffs on imports started raising the cost of some goods – dampening hopes for an interest rate cut in September.
The personal consumption expenditures (PCE) price index rose 0.3% last month. matching the the estimate of economists polled by Reuters. Year over year, the PCE increased 2.6%
Core PCE – which excludes volatile food and energy prices — also increased 0.3% from the month before – its highest rise since February and coming in hotter than expected, the Bureau of Economic Analysis said Thursday.
The figure rose 2.8% from the year before.
“Thursday’s PCE was stronger-than-expected and throws cold water on the idea of a fall rate cut,” Clark Bellin, president and chief investment officer at Bellwether Wealth, said in a note Thursday.
“Inflation remains sticky and justifies the Fed’s decision to keep interest rates unchanged at Wednesday’s meeting.”
Despite intense pressure from President Trump on Fed Chair Jerome Powell to lower rates, central bankers kept them between 4.25% and 4.
