US PCE Rises 3.4% in August, Below Expectations
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The US Commerce Department reported that the headline Personal Consumption Expenditures price index, which includes food and energy categories, rose 3.4% in August year over year, below analysts' forecast of 3.7% and unchanged from 3.4% in July. On a month-over-month basis, the headline PCE index rose 0.3%, below the forecast of 0.4%, following a 0.1% reading in July. Meanwhile, the core PCE index, which excludes food and energy categories and is the inflation gauge most closely watched by the Federal Reserve, rose 3.0% year over year, below the forecast of 3.3% and unchanged from 3.0% in July. On a month-over-month basis, the core PCE index rose 0.2%, below the forecast of 0.3%, following a 0.1% reading in July. The PCE index is regarded as an inflation measure that can capture changes in consumer behavior and covers a broader range of goods and services prices than the Consumer Price Index, or CPI.