Sign Up

The Fed’s preferred inflation gauge cooled last month

  • CNN
  • February 28, 2025
CNN

 — 

The Federal Reserve's preferred inflation gauge cooled as expected in January, providing a hopeful data point to price-weary Americans.

However, the seemingly positive report comes at a time when several other key metrics show that the US economy is softening.

The Personal Consumption Expenditures price index rose 2.5% in January from the year before, slowing from December's 2.6% annual rate, according to Commerce Department data released Friday.

The cost of food (especially eggs) and energy pushed up the Consumer Price Index and Producer Price Index readings for January. That had economists expecting PCE would rise about 0.3% from December but that the annual rate would slow to 2.5% from the initially reported 2.6%, FactSet estimates show.