08/31/2026
Inflation is still running above the Federal Reserve’s 2% target.
The Fed’s preferred inflation gauge, the personal consumption expenditures price index, rose 0.2% in July and 3.7% from a year earlier. Core PCE, which strips out food and energy prices, increased 3.3% annually.
The report also showed personal income rose 0.4% while spending increased 0.2%.
For consumers, that means price pressures haven’t disappeared, even as some categories, including gasoline and other energy-related goods, moved lower during the month.
With inflation still elevated, the latest numbers may remain an important part of the Fed’s upcoming interest-rate discussions.
The personal consumption expenditures price index was expected to rise 0.1% monthly and 3.6% on a 12-month basis, according to economists surveyed by Dow Jones.