Inflation rose to 4.4% in April, according to key gauge watched by Fed
by Zachary Halaschak, Economics Reporter
May 26, 2023 08:32 AM
Inflation unexpectedly rose to a 4.4% annual rate in April, as measured by the gauge favored by the Federal Reserve.
The rise in inflation in the personal consumption expenditures price index reported Friday morning by the Bureau of Economic Analysis is an unwelcome sign that price pressures are not yet abating in the face of the Fed’s campaign to slow price gains by hiking interest rates.
Inflation is running much hotter than the central bank’s target and damaging household purchasing power. Friday’s numbers were a surprise for economists and analysts, who predicted inflation would fall for another month. The consensus was that it would tick down to 3.9%.
Core PCE inflation, a measure of inflation that strips out energy and food prices and is generally less volatile, clocked in at a 4.7% year-over-year rate.
"We will be sticking with the forecast for the Fed to keep rates unchanged through the remainder of this year," said Ryan Sweet, chief U.S. economist at Oxford Economics. "However, odds are rising that we will be altering the forecast for the fed funds rate in 2024, reducing the number of rate cuts."
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https://www.washingtonexaminer.com/policy/economy/inflation-rose-to-4-4-in-april-according-to-key-gauge-watched-by-fed
