Key Inflation Gauge Jumps, Investors Ramp Up Bets for a More Aggressive Fed
U.S. inflation rates rose higher than expected in August, as investors expect a more aggressive monetary policy by the Federal Reserve in its efforts to curtail inflation toward the central bank’s preferred target of 2 percent.
The keenly watched Personal Consumption Expenditures price index (PCE) was published by the Bureau of Economic Analysis on Sept. 30.
The PCE, excluding the volatile prices of food and energy, rose 0.6 percent in August, after little growth in July, well above the 0.5 percent that many economists had predicted.
The news is another sign that inflation is spreading across the economy.
Core PCE, a key measure closely watched by the Fed, increased 4.9 percent year over year last month….