Key inflation gauge watched by the Federal Reserve hits another 30-year high

[Klaralven]

Inflation ran at a fresh 30-year high in August as supply chain disruptions and extraordinarily high demand fueled ongoing price pressures, the Commerce Department reported Friday.

The core personal consumption expenditures price index, which excludes food and energy costs and is the Federal Reserve’s preferred measure of inflation, increased 0.3% for the month and was up 3.6% from a year ago. The monthly gain was slightly higher than the 0.2% Dow Jones estimate and the annual forecast of 3.5%.

That’s the highest since May 1991 and reflective of inflationary pressures that Fed Chairman Jerome Powell said earlier this week he finds “frustrating.”

On a headline basis, PCE prices rose 0.4% for the month and 4.3% year over year, the highest since January 1991. That reflected a 24.9% increase in energy prices and a 2.8% rise in food.

https://www.cnbc.com/2021/10/01/key-inflation-gauge-watched-by-the-federal-reserve-hits-another-30-year-high.html

Note how they always exclude "food and energy costs" from "core inflation".

But, as energy and food costs continue to go up, more and more people this winter will have to choose -- "heat or eat?"

[WHITT]

2. But

3.6% is not THAT much higher than their targeted 2.2% rate, particularly considering the underlying situations. It's temporary, and it's already declining.

Note how they always exclude "food and energy costs" from "core inflation".

They're still basically in there, but economists strip-out food and energy so they can see what's happening without volatile spikes warping the numbers.

[jimfields33]

3. Food and energy are what most people notice.

[WHITT]

5. Sure

Food and energy remain in the inflation metric, they are merely alternatively separated so that economists can contrast to other time periods without their transitory ramifications.