Inflation continued to cool in June but remains above the Federal Reserve’s target.
The personal consumption expenditures price index was up 0.2 percent compared with a month ago, a slight pickup in prices compared with the 0.1 percent increase in May. Compared with year ago, the PCE price index is up three percent.
The Fed says it targets two percent PCE inflation.
So-called core PCE inflation, which excludes food and energy prices, rose 4.1 percent compared with a year earlier. For the month, prices rose 0.2, down from 0.3 percent in May and 0.4 percent in April.
Prices for goods decreased 0.1 percent and prices for services increased 0.3 percent. Food prices ticked down 0.1 percent and energy prices increased 0.6 percent. Durable goods prices fell for the month. Prices of used and new cars were lower.
A separate measure that tracks the costs of compensation showed wages and benefit costs rose one percent in the second quarter. That was slightly lower than the 1.1 percent increase expected. Wages and salaries increased 1.0 percent and benefit costs rose 0.9 percent from March 2023. Compensation costs for civilian workers increased 4.5 percent for the 12-month period ending in June 2023. Private sector compensation costs were up 4.5 percent.