ADDS FIGURES, EDITS THROUGHOUT
By Ovunc Kutlu
ISTANBUL (AA) - The US Federal Reserve's preferred annual inflation indicator came in at 2.7% in September, according to Commerce Department figures released Thursday.
The figure was slightly higher than expectations of 2.6% after the core personal consumption expenditures (PCE) price index also rose 2.7% annually in August.
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 estimates.
The PCE price index, which includes food and energy prices, rose 2.1% annually in September, after increasing 2.3% in August year-on-year, also coming in line with expectations.
That index increased 0.2% in September, following a 0.1% gain in August -- also in line with estimates.
The Fed has made 11 interest rate increases between March 2022 and July 2023 to tame record inflation, carrying the federal funds rate to between 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.
- Prices for goods fall 1.2%, services jump 3.7%
The Commerce Department's Bureau of Economic Analysis said prices for goods fell 0.1%, but prices for services rose 0.3%.
"Food prices increased 0.4 percent and energy prices decreased 2.0 percent," it said in a statement.
Annually, prices for goods plummeted 1.2%, but prices for services jumped 3.7%.
"Food prices increased 1.2 percent and energy prices decreased 8.1 percent," on an annual basis, it added.
There was a 0.4% increase in real PCE during September, which reflected a massive 0.7% gain in spending on goods and a rise of 0.2% in spending on services, the agency noted.
"Within goods, the largest contributor to the increase was other nondurable goods," said the statement. "Within services, the largest contributor to the increase was food services and accommodations.”