Fed's preferred annual inflation indicator comes at 2.7% in September, higher than 2.6% estimates

By Ovunc Kutlu

ISTANBUL (AA) - The US Federal Reserve's preferred annual inflation indicator came at 2.7% in September, according to Commerce Department figures released Thursday.

The figure came in slightly higher than market expectations of 2.6%, after the core personal consumption expenditures (PCE) price index also annually rose 2.7% in August.

On a monthly basis, the core PCE price index increased 0.3% in September, following a 0.2% month-on-month increase in August, and came in line with market estimates.

The PCE price index, which includes food and energy prices, annually rose 2.1% in September, after increasing 2.3% in August year-on-year, also coming in line with market expectations.

That index, on a monthly basis, increased 0.2% in September, following a 0.1% gain in August, and also coming in line with market estimates.

The Fed has made a total of 11 interest rate increases between March 2022 and July 2023 to tame the record inflation, carrying the federal funds rate to the 5.25%-5.5% target range – the highest in 22 years.

The US central bank skipped four rate hikes last year, and five more this year, before making a jumbo rate cut of 50 basis points on Sept. 18.