Annual inflation was 2.8% last month, according to the core personal consumption expenditures (PCE) index, the Fed’s preferred measure of inflation as it excludes price changes in the more volatile food and energy categories and it’s
more comprehensive than its rival consumer price index (CPI).
Economists expected core PCE inflation of 2.7%, according to median forecasts tracked by FactSet,
while Fed Chairman Jerome Powell said last week the U.S. central bank anticipated a 2.8% year-over-year increase.
Core PCE inflation is still far above central bankers’ target of 2%, a threshold it has not met
since February 2021.
Overall PCE inflation was 2.5% in February, matching the Fed’s and consensus economists’ matching projections of 2.5%.
The PCE index increased 0.3% from January to February and the core measure rose by 0.4%, adjusting for seasonality, compared to economist forecasts of a 0.3% month-over-month increase.