Sept. 27 (UPI) — Inflation continued to inch closer to the Federal Reserve benchmark target Friday, falling to 2.2% year-to-year in August amd beating Wall Street forecasts.
The personal consumption expenditures price index, one of the gauges the Federal Reserve looks at to determine monetary policy, targets the cost of U.S. goods and services. That cost rose 0.1% in August. The 2.2% rise in cost over the past 12 months was the slowest rise since February 2021.
Dow Jones economists had predicted that the 12-month inflation would rise 2.3% in August. The 0.1% rise in prices in August was in line with Wall Street anticipations.
A statistic that continues to worry economists from the report was the core PCE index, which excludes food and energy costs, which rose 2.7% over 12 months in August, 0.1% higher than it was in July.
Overall, however, economy watchers appeared to be happy with the PCE August results.
“Add today’s PCE Price Index to the list of economic data landing in a sweet spot,” Chris Larkin, managing director of trading and investing at E-Trade from Morgan Stanley, said, according to CNBC.
“Inflation continues to keep its head down, and while economic growth may be slowing, there’s no indication it’s falling off the cliff.”
Prices over the past month fell 0.2% for goods while increasing 0.2% for services. Food prices increased by 0.1% while energy prices fell by 0.8%.
Over the past 12 months, the price of goods increased by 0.9% while the price of services increased by 3.7%. Food prices increased by 1.1% while energy prices tumbled by 5%.
