\n<\/p>\n
Prices that consumers pay rose slightly in May, while the annual inflation rate edged further away from the Federal Reserve’s target, according to a Commerce Department report Friday.<\/p>\n
The personal consumption expenditures price index<\/a>, the Fed’s primary inflation reading, rose a seasonally adjusted 0.1% for the month, putting the annual inflation rate at 2.3%. Economists surveyed by Dow Jones had been looking for respective levels of 0.1% and 2.3%.<\/p>\n Excluding food and energy, core PCE posted respective readings of 0.2% and 2.7%, compared to estimates for 0.1% and 2.6%. Fed policymakers consider core to be a better measure of long-term trends because of historic volatility in the two categories. The annual rate was 0.1 percentage point ahead of the April reading.<\/p>\n Along with the inflation numbers, consumer spending and income showed further signs of weakening. Spending fell 0.1% for the month, compared to the estimate for an increase of 0.1%. Personal income declined 0.4%, against the forecast for a gain of 0.3%.<\/p>\n Markets had little reaction to the data, with stock market futures<\/a> indicating a positive open on Wall Street while Treasury yields also rose.<\/p>\n The report comes with the Fed contemplating its next move on interest rates.<\/p>\n Markets largely expect the central bank to remain on hold at its late July meeting. However, a few officials of late have been advocating a cut as long as inflation data shows muted pressures from the tariffs President Donald Trump has instituted since taking office in January.<\/p>\n Trump has been pushing the Fed to ease, insisting that inflation is low and the Fed can always switch gears if prices start moving higher again.<\/p>\n Fed Chair Jerome Powell, though, has advocated a more cautious report, despite increasingly aggressive pressure from the president. Trump has been criticizing Powell on a regular basis lately, earlier this week calling him “stupid” and indicating that he will name a successor soon.<\/p>\n Inflation pressures generally were muted in May.<\/p>\n Food prices increased 0.2%, but that was offset by a 1% decline in energy-related goods and services costs, including a 2.2% slide in gasoline and other energy goods. Shelter prices increased 0.3%.<\/p>\n<\/div>\n<\/div>\n\n
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