Core prices rise less than expected as Fed watches closely
US inflation rose 0.3 per cent in August, below forecast 0.4 per cent, with core inflation also coming in lower than expected.
The personal consumption expenditures price index, the Federal Reserve's preferred inflation measure, rose 0.3 per cent in August versus the 0.4 per cent economists predicted. On a yearly basis, PCE inflation stood at 3.4 per cent, unchanged from July.
Core PCE, which excludes volatile food and energy costs, rose 0.2 per cent month-on-month, also below the forecast of 0.3 per cent. On an annual basis, core inflation remained at 3.0 per cent.
Separately, personal spending jumped 0.9 per cent in August, suggesting consumer demand remains resilient despite higher prices. The softer inflation figures could influence the Federal Reserve's interest rate decisions in coming months.
- 0.3 per cent
- PCE monthly rise
- 3.4 per cent
- PCE annual rate
- 0.2 per cent
- Core PCE monthly rise
- 0.9 per cent
- Personal spending jump
Why it mattersSofter inflation could slow the Fed's pace of rate cuts, affecting global bond markets and investment returns worldwide.
AustraliaUS inflation trends eventually flow through to Australian interest rates and the Reserve Bank's policy decisions, affecting mortgage rates and living costs.
Corroborated byabc.net.au
✓ Claims checked against the source and corrected before publish. checked 1 h ago
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