Fed's Collins Sees Mixed US Inflation Report with 'Promising Signs'

Boston Federal Reserve President Susan Collins says the latest US inflation report is 'mixed', with the headline rate stronger than expected but driven higher by factors that shouldn't push the central bank towards raising interest rates. The Personal Consumption Expenditures Price Index rose at a 3.7% annual rate in July, above the Fed's target.

Collins cited the rise in portfolio management fees as one example of a force driving inflation that is not a concern for her. She noted that these fees are driven by stock values rather than supply and demand conditions.

The Boston Fed research pointed to other reasons why price pressures may ease, including improved productivity and indications that inflation linked to the Trump administration's import tariffs may have almost run its course.