The US Federal Reserve’s preferred measure of inflation continued its upward rise in February, beating a four-year record set the month before, the Commerce Department reported Friday.
The Personal Consumption Expenditures price index rose at an annual rate of 2.1 percent, just beyond the Fed’s two percent target and hitting a pace not recorded since April 2012. The measure has been trending upwards since August.
Citing strong hiring and rising prices, the central bank has raised its benchmark interest rates twice since December and projects two more increases are likely this year.
The less volatile “core” PCE price index, which excludes prices for food and fuel, held steady last month, rising at an annual rate of 1.8 percent, the same as January.
On a monthly basis, upward price pressures were less pronounced. Gains in the price index slowed to 0.1 percent in February, down three-tenths of a point from the prior month, matching analyst expectations.
The core index also slowed to 0.2 percent, a tenth below January’s increase, also as an analyst consensus had expected.
Personal incomes rose 0.4 percent, or $57.7 billion, in February, far faster than the 0.1 percent gain in spending. Accounting for inflation, so-called real consumption actually fell 0.1 percent.
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