Pedestrians walk near the New York Stock Exchange on Wall Street in New York City in September of 2024. File Photo by John Angelillo/UPI | License Photo
July 31 (UPI) — The Federal Reserve‘s preferred inflation gauge rose more than expected in June, according to a report by the U.S. Bureau of Economic Analysis released Thursday.
The personal consumption expenditures index, or PCE, rose 0.3% in June from the previous month and 2.6% from June 2024. Core PCE, which excludes volatile food and energy prices rose 2.8% on an annual basis.
The annual increases were higher than analysts’ expectations of a 2.5% increase for PCE and 2.7% rise for core PCE.
Additionally, when measured at a monthly rate, Americans saw their income increase by 0.3%, or $71.4 billion. However, after taxes that increase in dollars dips to around $61 billion, and the value of the goods and services bought by or for American citizens, or personal consumption expenditures, also rose 0.3% to $69.9 billion.
As for savings, residents held on to $1.01 trillion in personal savings in June, and when measured as a percentage of disposable income, those personal savings came in at 4.5%.
Inflation was also evident via the consumer price index, or CPI, as that rose 0.3% for urban consumers increased 0.3% since June when seasonally adjusted, and 2.7% over the last 12 months not seasonally adjusted, despite dipping as low as 2.3% in April.
The Fed continues to hold short-term interest rates steady at a range of 4.25% to 4.5% following its meeting earlier this week, with Fed Chair Jerome Powell citing earlier this month that the impact of President Donald Trump‘s reciprocal tariff strategy is the reason the Fed hasn’t gotten back to cutting rates.
Trump, who has been pushing for the Fed to lower rates, posted to Truth Social Thursday in regard to the Fed’s hold, saying Powell “is costing our Country TRILLIONS OF DOLLARS,” and called him a TOTAL LOSER.”