Core PCE Price Index Up 3.6% Year-on-Year
Monthly Increase of 0.3%, Smaller Rise Compared to Previous Month
Powell Says "Inflation Is Temporary"... Atlanta Fed President Expresses Concern Over Prolonged Inflation
[Asia Economy New York=Correspondent Baek Jong-min] The core Personal Consumption Expenditures (PCE) price index, an important reference for monetary policy decisions by the U.S. Federal Reserve (Fed), recorded the largest increase in 30 years for two consecutive months.
The U.S. Department of Commerce announced on the 27th (local time) that the core PCE price index for July rose 3.6% compared to the same month last year.
This matched the Dow Jones consensus forecast. On a month-to-month basis, it rose 0.3%, a smaller increase compared to June's 0.4%.
Although the monthly increase slowed, the annual increase remains the largest since May 1991.
The core PCE price index is known as the Fed's most preferred inflation gauge. The Fed's inflation target is an average of 2%.
The PCE price index, which includes volatile energy and food prices, rose 0.4% from the previous month and 4.2% from the same month last year.
The year-over-year increase was slightly higher than June's 4.0%, and CNBC reported it is the largest since January 1991, when the First Gulf War began.
Despite ongoing inflation concerns, Fed Chair Jerome Powell reiterated in his Jackson Hole speech that inflation is temporary.
On the other hand, Raphael Bostic, President of the Atlanta Fed, said in an interview with CNBC on the same day, "I expect inflation to persist over a long period beyond the short term."
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