Inflation down, excluding the most volatile factors
Smialek, New York Times Fed Reserve Reporter, 6-28-24
[Jeanna, 6-28-24, The New York Times, “The Fed Preferred Inflation Measure Cools, Welcome News”, , accessed: 7-14-24, AngH]
The Personal Consumption Expenditures index climbed 2.6 percent in May from a year earlier, matching what economists had forecast and down from 2.7 percent previously.
After stripping out volatile food and fuel prices to give a better sense of the inflation trend, a “core” price measure was also up 2.6 percent from a year earlier, down from 2.8 percent in the April reading. And on a monthly basis, inflation was especially mild, and prices did not climb on an overall basis.
The Fed is likely to watch the fresh inflation data closely as central bankers think about their next policy steps. Officials raised interest rates sharply starting in 2022 to hit the brakes on consumer and business demand, which in turn can help to slow price increases. But they have held borrowing costs steady at 5.3 percent since July as inflation has slowly come down, and have been contemplating when to begin lowering interest rates.