Key US Inflation Gauge Picks Up on Goods, Spending Barely Rises

The Federal Reserve’s preferred measure of underlying inflation increased in June at one of the fastest paces this year while consumer spending barely rose, underscoring the dueling forces dividing policymakers over the path of interest rates.

The so-called core personal consumption expenditures price index, which excludes food and energy items, rose 0.3% from May, according to Bureau of Economic Analysis data out Thursday. It advanced 2.8% on an annual basis, a pickup from June 2024 that underscores limited progress on taming inflation in the past year.