Fed’s Favored Inflation Measure Continued to Cool in November
The inflation gauge preferred by the Federal Reserve rose in November at the slowest pace in four months as prices for goods dropped.
The Commerce Department’s core Personal Consumption Expenditures (PCE) Price Index, which leaves out volatile food and energy prices, was up 0.2% from the month before, the smallest increase since July. The year-over-year gain was 4.7%, down from 5% in October. Both were in line with economists’ forecasts.
The overall PCE Price Index climbed 0.1%, down from 0.4% in October and slightly less than the 0.2% economists expected. The annual rate eased to 5.5% from 6.1% in October, and was the lowest 12-month rise since October 2021.
Prices for goods were down 0.4%, and they were higher by 0.4% for services. Energy costs sank 1.5% as gasoline prices tumbled. Food prices were up 0.3%. For the year, energy prices gained 13.6%, and food costs advanced 11.2%.
Personal spending increased 0.1%, less than estimates. Spending rose for services, led by housing. It fell for goods, with purchases of new motor vehicles the biggest contributor to the decline.
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