Fed’s Favored Inflation Gauge Falls Slightly in May – By Tim Smart (US News) / June 30, 2022
The reading offers hope that the economy may have seen the peak of inflation.
An index of inflation closely watched by the Federal Reserve dipped slightly in May, perhaps signaling that prices may be slowing somewhat from their rapid pace earlier this year.
The “core” personal consumption expenditures index, which strips out often volatile food and energy costs, rose at an annual rate of 4.7% in May, down from 4.9% in April, the Bureau of Economic Analysis reported on Thursday.
The index rose 0.3% for the month, unchanged from April. Economists had expected an annual rate of 4.8% and a monthly increase of 0.4%.
The overall index rose 6.3% for the year, unchanged from April.
The Fed often cites the core index as it sets monetary policy. The central bank is raising interest rates to ward off inflation, which has been running at an 8.6% annual rate measured by the more common consumer price index.
