Fed's key inflation measure shows highest jump since October 2023

The Federal Reserve’s primary inflation measure, excluding food and energy, rose 3.4% on an annual basis after jumping 0.3% for the month. 

The figures were both in line with the Dow Jones consensus. It was the highest level since October 2023, CNBC reported. 

Including food and energy, the personal consumption expenditures price index, which measures the average change in prices paid for domestic goods and services by consumers, showed inflation running at a seasonally adjusted annual rate of 4.1%, the highest since April 2023, the Commerce Department reported Thursday. 

On a monthly basis, the PCE index rose 0.4%. Energy showed the highest price gains, with related goods and services climbing 4% for the month. Housing costs were up 0.3%, while financial and insurance services increased 1.2%. 

Despite high inflation rates, consumer spending was higher than expected. Personal consumption expenditures rose 0.7% for the month, slightly higher than forecasts. Personal income was up 0.7%, considerably higher than the 0.4% forecast, and the personal savings rate increased 3%.