The Federal Reserve’s preferred inflation gauge—the personal consumption expenditure (PCE) price index—came in below expectations, suggesting that the central bank is inching closer to its 2 percent target.
According to the Bureau of Economic Analysis (BEA), the PCE price index rose by 0.1 percent in August, down from the 0.2 jump in July.
The PCE decelerated to 2.2 percent year over year, down from 2.5 percent in the previous month.
Both readings came in below economists’ expectations.
The PCE showed that prices for goods tumbled by 0.9 percent from a year ago, and services surged by 3.7 percent. Food costs increased by 1.1 percent, and energy prices fell by 5 percent….